Weighted Average Method, Unit Cost, Valuing Inventories Manzer Enterprises produ

Question

Weighted Average Method, Unit Cost, Valuing Inventories

Manzer Enterprises produces premier raspberry jam. Output is measured in pints. Manzer uses the weighted average method. During January, Manzer had the following production data:

Required:

1. Using the weighted average method, calculate the equivalent units for January.
equivalent units

2. Calculate the unit cost for January. Round your answer to the nearest cent.
$per unit

3. Assign costs to units transferred out and EWIP.

Units in process, January 1, 60% complete 36,000 pints Units completed and transferred out 240,000 pints Units in process, January 31, 40% complete 75,000 pints Costs: Work in process, January 1 $54,000 Costs added during January 351,000

Explanation / Answer

a) Equivalent unit = 240000+(75000*40%) = 270000 units

b) Cost per equivalent unit = (54000+351000)/270000 = 1.5 per equivalent unit

c) Cost of goods transferred out = 240000*1.5 = 360000

Ending work in process = 75000*40%*1.5 = 45000

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