Question

Calculate Equivalent Units, Unit Costs, and Transferred Costs—Weighted Average Method

Kipling Manufacturing, Inc., operates a plant that produces its own regionally-marketed Super Salad Dressing. The dressing is produced in two processes, blending and bottling. In the Blending Department, all materials are added at the beginning of the process, and labor and overhead are incurred evenly throughout the process. Kipling uses the weighted average method. The Work in Process—Blending Department account for January 2016 follows:

Work in Process-Blending Department
January 1 inventory (4,000 gallons, 75% finished)
Direct material	$31,200
Conversion costs	8,800
Transferred to Bottling Department (70,000 gallons)
January charges:
Direct material (71,000 gallons)	568,000
Direct labor	164,000
Manufacturing overhead	186,000
January 31 inventory [ ? gallons, 60% processed]

Required

Calculate the following amounts for the Blending Department:

1. Number of units in the January 31 inventory.

2. Equivalent units for materials cost and conversion costs.

3. January cost per equivalent unit for materials and conversion costs.

4. Cost of the units transferred to the Bottling Department.

5. Cost of the incomplete units in the January 31 inventory.

Round average cost per equivalent unit to four decimal places. Use rounded answers for subsequent calculations. Round other answers to the nearest whole number.

Kipling Manufacturing,Inc. Blending Department Flow of Units and Equivalent Units Calculation, January 2016
		Equivalent Units
		% Work done	Direct Materials	% Work Done	Conversion Costs
Complete/Transferred	Answer	Answer%	Answer	Answer%	Answer
Ending Inventory	a. Answer	Answer%	Answer	Answer%	Answer
Total	Answer	b.	Answer		Answer

Product Cost Report
			Direct Materials		Conversion Costs
Beginning Inventory	$Answer		$Answer		$Answer
Current	Answer		Answer		Answer
Total Costs to Account For	$Answer		$Answer		$Answer
÷ Total Equivalent Units			Answer		Answer
Average cost / Equivalent unit (round 4 decimal places)			$Answer	c.	$Answer	c.
Complete / Transferred:
Direct Materials	$Answer
Conversion costs	Answer
Cost of Goods Manufactured	$Answer	d.
Ending Inventory:
Direct Materials	$Answer
Conversion costs	Answer
Cost of Ending Inventory	$Answer	e.
Total Costs Allocated	$Answer

Need correct answers entered in where it asks for answer.

Answer 1

Kipling Manufacturing, Inc. Blending Department
Flow of Units and Equivalent Units Calculation, January 2016
		Equivalent Units
		% Work done	Direct Materials	% Work done	Conversion Costs
Completed/Transferred out	70000	100%	70000	100%	70000
Ending Inventory	5000	100%	5000	60%	3000
Total	75000		75000		73000

Product Cost Report
			Direct Materials	Conversion Costs
Beginning Inventory		40000	31200	8800
Current		918000	568000	350000
Total Costs to Account For		958000	599200	358800
÷ Total Equivalent Units			75000	73000
Average cost/Equivalent unit (round 4 decimal places)			7.9893	4.9151
Completed/Transferred:
Direct Materials		559251
Conversion costs		344057
Cost of Goods Manufactured		903308
Ending Inventory:
Direct Materials		39947
Conversion costs		14745
Cost of Ending Inventory		54692
Total Costs Allocated		958000