Question

Clopack Company manufactures one product that goes through one processing department called Mixing. All raw materials are introduced at the start of work in the Mixing Department. The company uses the weighted-average method of process costing. Its Work in Process T-account for the Mixing Department for June follows (all forthcoming questions pertain to June): Work in Process—Mixing Department June 1 balance 25,000 Completed and transferred to Finished Goods ? Materials 157,080 Direct labor 99,500 Overhead 117,000 June 30 balance ? The June 1 work in process inventory consisted of 4,000 units with $13,020 in materials cost and $11,980 in conversion cost. The June 1 work in process inventory was 100% complete with respect to materials and 60% complete with respect to conversion. During June, 36,500 units were started into production. The June 30 work in process inventory consisted of 9,600 units that were 100% complete with respect to materials and 50% complete with respect to conversion. g

Answer 1

beginning WIP 4,000 units:

materials $13,020 (100% complete)

conversion $11,980 (60% complete)

35,000 units started into production

ending WIP = 9,600 units

materials 100% complete ⇒ EU = 9,600

conversion 50% complete ⇒ EU = 4,800

costs added during June:

materials $157,080

conversion $99,500 + $117,000 = $216,500

units transferred out = 35,000 + 4,000 - 9,600 = 29,400 units

EU production:

materials = 39,000

conversion = 29,400 + 4,800 = 34,200

total costs:

materials = $13,020 + $157,080 = $170,100

conversion = $11,980 + $216,500 = $228,480

cost per equivalent unit:

EU for materials = $170,100 / 39,000 = $4.3615

EU for conversion = $228,480 / 34,200 = $6.6807

total costs assigned to finished units = (29,400 x $4.3615) + (29,400 x $6.6807) = $324,642

total costs assigned to ending WIP = (9,600 x $4.3615) + (4,800 x $6.6807) = $73,938