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Alpha Company Had The Following Information For FY 2017: Work In Process Alpha Company had the...

Alpha Company Had The Following Information For FY 2017: Work In Process

Alpha Company had the following information for FY 2017:

Work in Process - 1/1/17

100,000 units

Units Started into Production

575,000 units

Work in Process - 12/31/17

75,000 units

Direct Material put into Production

$575,000

Direct Labor put into Production

$843,750

The beginning work in process was 100% complete as to direct materials and 75% complete as to conversion costs.

The ending work in process was 100% complete as to direct materials and 50% complete as to conversion costs.

The beginning work in process consisted of:

Direct Material

$943,750

Conversion Costs

$303,750

Alpha company uses the weight-average method. Use the information to prepare the cost allocation section of the cost of production report for FY 2017.

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Answer #1

Cost allocation section :

Cost to be accounted for
Beginning work in process (943750+303750) 1247500
Cost added (575000+843750) 1418750
Total Cost to be accounted for 2666250
Cost accounted for
Cost of unit transferred out (2.25+1.80)*600000 2430000
Ending work in process (2.25*75000+1.8*37500) 236250
Total Cost accounted for 2666250

Equivalent unit of material = 600000+75000 = 675000

Equivalent unit of conversion = 600000+37500 = 637500

Cost per equivalent unit of material = (575000+943750)/675000 = 2.25

Cost per equivalent unit of conversion = (843750+303750)/637500 = 1.80

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