Question

PepFizz Company is a manufacturer of carbonated beverages. The company uses the FIFO method. The following information pertains to the Bottling Department for the month of May. Materials Conversion Equivalent units in beginning work in process inventory 1,100 800 Equivalent units to complete beginning work in process inventory 1,400 1,100 Units started and completed during May 8,500 8,500 Equivalent units in ending work in process inventory 1,800 1,500 Costs in the beginning work in process inventory $ 3,500 $ 3,900 Cost per equivalent unit $ 3 $ 5 Knowledge Check 01 What is the Bottling Department’s cost of ending work in process inventory?

Answer 1

Answer: $12,900

Step-by-step explanation:

Bottling department cost of ending work in process inventory will be the cost of the equivalent units for ending WIP for both Materials and Conversion.

Cost of Ending WIP = Cost of Materials WIP + Cost of Conversion WIP

= (1,800 * 3) + (1,500 * 5)

= $12,900