Question

Cranford Company completed and transferred out 3,400 units in May 2020. There were 250 units in the Work-in-Process Inventory on May 31, 2020, 40% complete as to conversion costs and 100% complete as to materials. The month's charges for conversion costs and material costs were $17,850 and $13,140, respectively. There was no beginning inventory on May 1, 2020. What is the cost of the work transferred-out during May, assuming that Cranford uses weighted-average process costing

Answer 1

$29,580

Step-by-step explanation:

we must first determine equivalent units:

EUP for materials = 3,400 + 250 = 3,650 EUP

EUP for conversion costs = 3,400 + (250 x 40%) = 3,500 EUP

conversion cost per EUP = $17,850 / 3,500 EUP = $5.10

materials per EUP = $13,140 / 3,650 EUP = $3.60

total costs per EUP = $8.70

total units transferred out = 3,400

total cost of units transferred out = 3,400 x $8.70 = $29,580