Question

Barnett Corporation uses the weighted-average method in its process costing system. The

company adds materials at the beginning of the process in Department M. Material costs
were 100% complete and conversion costs were 75% complete with respect to the 4,000
units in work in process at May 1. Material costs were 100% complete and conversion costs
were 50% complete with respect to the 6,000 units in work in process at May 31. During
May, 12,000 units were completed and transferred to the next department. An analysis of the
costs relating to work in process at May 1 and to production activity for May follows:

Materials Conversion

Work in process, May 1.......... $13,800 $ 3,740

Costs added during May........ $42,000 $26,260
a.The total equivalent units of production for materials are:

b. The total cost per equivalent unit for May was:

Answer 1

a. 18,000

b. $5.10

Step-by-step explanation:

Calculation of the total equivalent units of production for materials

Units of Closing Work In Process (6,000× 100%) = 6,000

Units completed and transferred (12,000× 100%) = 12,000

Total = 18,000

Calculation of the total equivalent units of production for conversion

Units of Closing Work In Process (6,000 × 50%) = 3,000

Units completed and transferred (12,000× 100%) = 12,000

Total = 15,000

Calculation of Total Cost of Materials

Work in process $13,800

Costs added during May $42,000

Total $55,800

Calculation of Total Cost of Conversion

Work in process $ 3,740

Costs added during May $26,260

Total $30,000

Calculation of total cost per equivalent unit for May

Materials ($55,800/18,000) = $3.10

Conversion ( $30,000/15,000) = $2.00

Total = $5.10