Oholics, Ltd., produces chocolate that it sells to candy makers. On April 1, it

Question

Oholics, Ltd., produces chocolate that it sells to candy makers. On April 1, it had no work-in-process inventory. It started production of 20,000 pounds of chocolate in April and completed production of 19,000 pounds. The costs of the resources used by Oholics in April consist of the following: The production supervisor estimates that the ending work in process is 60 percent complete on April 30. Compute the cost of chocolate completed and the cost of the chocolate in work-in-process ending inventory as of April 30. (Do not round intermediate calculations.)

Explanation / Answer

Beginning inventory         0

Started in April                          20,000

Total                                        20,000

Ending work in process (1,000*60%)             600

Transferred out                             19,400

Materials                     $29,700        

Conversion cost             $36,940       

(Labor & Overhead)

Total cost                       $66,640

Cost per unit = $66,640/19,400 = $3.44

Cost of completed production = 19,000 * $3.44 = $65,266

Cost of ending work in process = 400 units * $3.44 = $1,376

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