Exercise 20-6 Weighted average: Cost per EUP and costs assigned to output LO C2

Question

Exercise 20-6 Weighted average: Cost per EUP and costs assigned to output LO C2 The fields Company has two manufacturing departments, forming and painting. The company uses the weighted-average method of process costing. At the beginning of the month, the forming department has 28,500 units in inventory 70% complete as to materials and 30% complete as to conversion costs. The beginning inventory cost of S67,100 consisted of $49,000 of direct material costs and $18,100 of conversion During the month the forming department started 370,000 units At the end of the month the forming department had 37,000 units in ending inventory, 85% complete as to materials and 35% complete as to conversion. Units completed in the forming department are transferred to the painting department Calculate the equivalent units of production for the forming department

Explanation / Answer

Units Completed During the month = 28,500 + 370,000 - 37,000 = 361,500

Statement of Equivalent Units

Particulars Units %age completed Direct Material %age completed Conversion Cost Units Completed 361,500 100% 361,500 100% 361,500 Closing Units 37,000 85% 31,450 35% 12,950 Total Equivalent Units 392,950 374,450

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