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28 December, 18:54

Materials are added at the beginning of the process. The ending work-in-process is 50% complete as to conversion costs. How would the total costs accounted for be distributed, using the weighted-average method?

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  1. 28 December, 22:30
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    Complete Question

    Information for the month of January concerning Department A, the first stage of Ogden Corporation's production cycle, is as follows:

    Materials

    Conversion

    BWIP

    $ 8,000

    $ 6,000

    Current costs

    40,000

    32,000

    Total costs

    $ 48,000

    $38,000

    Equivalent units using weighted-average method

    100,000

    95,000

    Average unit costs

    $ 0.48

    $ 0.40

    Goods completed

    90,000 units

    EWIP

    10,000 units

    Materials are added at the beginning of the process. The ending work-in-process is 50% complete as to conversion costs. How would the total costs accounted for be distributed, using the weighted-average method?

    Goods

    Ending Work-

    Completed

    In-Process

    A B C D

    $88,000 $79,200 $86,000 $79,200

    $6,800 $8,800 $0 $6,800

    Solution

    Completed goods

    Materials (90,000 * $.48)

    $43,200

    Cost of completed goods

    $79,200

    Conversion costs (90,000 * $.40)

    36,000

    Given that EWIP is 50% complete as to conversion costs, 5,000 (10,000 * 50%) equivalent units of conversion cost are in ending inventory.

    EWIP:

    Materials (10,000 * $.48)

    $ 4,800

    Conversion costs (5,000 * $.40)

    2,000

    Cost of EWIP

    $ 6,800
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