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14 September, 15:03

The Gasson Company uses the weighted-average method in its process costing system.

The company's ending work in process inventory consists of 10,000 units, 100% complete with respect to materials and 70% complete with respect to labor and overhead.

Required:

If the costs per equivalent unit are $4.50 for the materials and $2.00 for labor and overhead, the balance of the ending work in process inventory account would be:

A. $44,500

B. $50,500

C. $59,000

D. $65,000

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Answers (1)
  1. 14 September, 17:32
    0
    Option (C) is correct.

    Explanation:

    Given that,

    Ending work in process inventory consists = 10,000 units

    100% complete with respect to materials

    70% complete with respect to labor and overhead

    costs per equivalent unit for material = $4.50

    costs per equivalent unit for labor and overhead = $2.00

    Balance of Ending WIP:

    = Direct Material + Labor and Overhead

    = (10,000 * $4.50) + (10,000 * 70% * $2.00)

    = $45,000 + $14,000

    = $59,000
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