Question

Superior Micro Products uses the weighted-average method in its process costing system. During January, the Delta Assembly Department completed its processing of 25,000 units and transferred them to the next department. The cost of beginning inventory and the costs added during January amounted to $599,780 in total. The ending inventory in January consisted of 3,000 units, which were 80% complete with respect to materials and 60% complete with respect to labor and overhead. The costs per equivalent unit for the month were as follows: Materials Labor Overhead Cost per equivalent unit $ 12.50 $ 3.20 $ 6.40 Required: 1. Compute the equivalent units of materials, labor, and overhead in the ending inventory for the month. 2. Compute the cost of ending inventory and of the units transferred to the next department for January. 3. Prepare a cost reconciliation for January. (Note: You will not be able to break the cost to be accounted for into the cost of beginning inventory and costs added during the month.)

Total cost to be accounted for:

Costs accounted for as follows:

Blank Blank amount

Blank Blank amount

Total cost accounted for:

Answer 1

1) Equivalent unit :

	Whole unit	%	EUP-Material	%	EUP-conversion
Unit transferred out	25000	100%	25000	100%	25000
Ending work inprocess	3000	80%	2400	60%	1800
Total	28000		27400		26800

2) Cost of ending work in process = (2400*12.50+1800*3.2+1800*6.40) = 47280

Cost of units transferred to the next department = (12.50+3.2+6.40)*25000 = 552500

3) Prepare cost reconciliation :

Total cost of beginning work in process and cost added	599780
Cost accounted as
Cost of units transferred out	552500
Cost of ending work in process	47280
Total cost accounted as	599780