Process Costing 1113 20-23 Computing EUP, assigning costs, with beginning WIP, n

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Process Costing 1113 20-23 Computing EUP, assigning costs, with beginning WIP, no costs Learning Objectives 2, 3 transferred in Shea Winery in Pleasant Valley, New York, has two departments: Fermenting and Packaging Direct materials are added at the beginning of the fermenting process (grapes) and at the end of the packaging process (bottles). Conversion costs are evenly throughout each process. The company uses the weighted-average method. Data from the month of March for the Fermenting Department are as fol 1. EUP for CC 8,860 added lows: Gallons Beginning Work-in-Process Inventory Started in production Completed and transferred out to Packaging in March Ending work-in-Process Inventory (80% of the way through the fermenting process 500 gallons 8,600 gallons 7,900 gallons 1,200 gallons Costs Beginning Work-in-Process Inventory: Direct materials Direct labor Manufacturing overhead allocated 540 195 210 Costs added during March: Direct materials Direct labor Manufacturing overhead allocated 9,288 3,305 3,378 15,971 Total costs added during March Requirements 1. Compute the Fermenting Department's equivalent units of production for direct materials and for conversion costs. 2. Compute the total costs of the units (gallons) a. completed and transferred out to the Packaging Department. b. in the Fermenting Department ending Work-in-Process Inventory

Explanation / Answer

Solution 20-23:

Computation of Equivalent unit of Production - Weighted Average (Fermenting Department) Particulars Physical Units Material Conversion (Labor + Overhead) Unit completed & Transferred out 7900 7900 7900 Closing WIP: 1200 Material (100%) 1200 Conversion (80%) 960 Equivalent units of production 9100 9100 8860

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