Process Costing: Equivalent Units Using Weighted-Average Method O\'Callahan Snac

Question

Process Costing: Equivalent Units Using Weighted-Average Method O'Callahan Snack Company produces gourmet chips and other snack foods. One of the company's most popular snacks is a combination of several varieties of organic potatoes. The snack food goes through several processes, including a potato-peeling operation. Costs for operations during April are as follows (note: production costs include the cost of direct materials and conversion costs for the department): Assume that O'Callahan Snack Company used the weighted-average method of process costing.

A. How many equivalent units did O'Callahan complete during April?

B. Calculate the cost of the ending work in process inventory. In your calculations, round the cost per equivalent unit to two decimal places. Round your final answer to the nearest dollar

Explanation / Answer

Opening WIP => 3000 * 90% => 2700 units

Transferred => 18000 units

Closing WIP => 5000 *85% => 4250

Equivalent units did O'Callahan complete during April => 2700 + 18000 + 4250 => 24950 units

Answer2

Cost per equivalent unit => (10000 + 70240 ) / 24950 => $3.22 per unit

ost of the ending work in process inventory => 4250 * 3.22 => $13685

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