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ID: 2510388 • Letter: R
Question
Required information
[The following information applies to the questions displayed below.]
Victory Company uses weighted-average process costing to account for its production costs. Conversion cost is added evenly throughout the process. Direct materials are added at the beginning of the process. During November, the company transferred 740,000 units of product to finished goods. At the end of November, the work in process inventory consists of 202,000 units that are 50% complete with respect to conversion. Beginning inventory had $306,150 of direct materials and $105,125 of conversion cost. The direct material cost added in November is $2,048,850, and the conversion cost added is $1,997,375. Beginning work in process consisted of 77,000 units that were 100% complete with respect to direct materials and 80% complete with respect to conversion. Of the units completed, 77,000 were from beginning work in process and 663,000 units were started and completed during the period.
Required:
1. Determine the equivalent units of production with respect to direct materials and conversion.
Beginning work in process inventory - units
Ending work in process - units
Units completed and transferred out
Units started this period
Beginning work in process inventory - units
Ending work in process - units
Units completed and transferred out
Units started this period
2. Compute both the direct material cost and the conversion cost per equivalent unit.
Costs incurred this period
Costs of beginning work in process
Costs of ending work in process
Costs transferred out
Costs incurred this period
Costs of beginning work in process
Costs of ending work in process
Costs transferred out
3. Compute the direct material cost and the conversion cost assigned to units completed and transferred out and ending work in process inventory. (Round "Cost per EUP" to 2 decimal places.)
Beginning work in process inventory - units
Ending work in process - units
Units completed and transferred out
Units started this period
Beginning work in process inventory - units
Ending work in process - units
Units completed and transferred out
Units started this period
Total unitsExplanation / Answer
Equivalent units of production (EUP)- weighted average method
Units
% Materials
EUP- Materials
% Conversion
EUP- Conversion
Units completed and transferred out
740,000
100%
740,000
100%
740,000
Ending goods in process - units
202,000
100%
202,000
50%
101,000
Total units
942,000
942,000
841,000
Cost per equivalent unit of production
Materials
Conversion
Cost of beginning goods in process
$306,150
$105,125
Costs incurred this period
2,048,850
1,997,375
Total costs
Costs
$2,355,000
Costs
$2,102,500
÷ Equivalent units of production
EUP
942,000
EUP
841,000
Cost per equivalent unit of production (rounded to 2 decimals)
$2.50
$2.50
Cost of units transferred out:
EUP
Cost per EUP
Total cost
Direct materials
740,000
$2.50
1,850,000
Conversion
740,000
$2.50
1,850,000
Total costs transferred out
$3,700,000
Costs of ending goods in process
EUP
Cost per EUP
Total cost
Direct materials
202,000
$2.50
505,000
Conversion
101,000
$2.50
252,500
Total cost of ending goods in process
$757,500
Total costs accounted for
1Equivalent units of production (EUP)- weighted average method
Units
% Materials
EUP- Materials
% Conversion
EUP- Conversion
Units completed and transferred out
740,000
100%
740,000
100%
740,000
Ending goods in process - units
202,000
100%
202,000
50%
101,000
Total units
942,000
942,000
841,000
2Cost per equivalent unit of production
Materials
Conversion
Cost of beginning goods in process
$306,150
$105,125
Costs incurred this period
2,048,850
1,997,375
Total costs
Costs
$2,355,000
Costs
$2,102,500
÷ Equivalent units of production
EUP
942,000
EUP
841,000
Cost per equivalent unit of production (rounded to 2 decimals)
$2.50
$2.50
3Cost of units transferred out:
EUP
Cost per EUP
Total cost
Direct materials
740,000
$2.50
1,850,000
Conversion
740,000
$2.50
1,850,000
Total costs transferred out
$3,700,000
Costs of ending goods in process
EUP
Cost per EUP
Total cost
Direct materials
202,000
$2.50
505,000
Conversion
101,000
$2.50
252,500
Total cost of ending goods in process
$757,500
Total costs accounted for
$4,457,500Related Questions
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