Question

# Tannenbaum Corporation uses the weighted average method in its process costing system. This month, the beginning...

Tannenbaum Corporation uses the weighted average method in its process costing system. This month, the beginning inventory in the first processing department consisted of 400 units. The costs and percentage completion of these units in beginning inventory were:

Cost                % complete

Materials costs                        5,700               65%

Conversion costs                     6,800               45%

A total of 6,500 units were started and 5,900 units were transferred to the second processing department during the month. The first processing department incurred \$125,500 of materials costs and \$206,950 of conversion costs during the month.

The ending inventory was 50% complete with respect to materials and 35% complete with respect to conversion costs. Complete the following to determine the cost of ending WIP inventory in the first processing department (show calculations if needed):

 Number of units in ending WIP
 Materials Conversion Units transferred to the next department + Ending WIP Equivalent units of production
 Materials Conversion Cost of beginning WIP + Costs added during the period Total cost / Equivalent units of production Cost per equivalent unit
 ENDING WORK-IN-PROCESS INVENTORY: Materials Conversion TOTAL Units in Ending WIP x Cost per equivalent unit Cost of Ending Work-in-Process inventory

Calculate following :

 Number of units in ending WIP Material Conversion Units transferred to the next department 5900 5900 + Ending WIP (400+6500-5900) 1000*50% = 500 1000*35% = 350 Equivalent units of production 6400 6250 Material Conversion Cost of beginning WIP 5700 6800 + Costs added during the period 125500 206950 Total Cost 131200 213750 / Equivalent units of production 6400 6250 Cost per equivalent unit 20.50 34.20 ENDING WORK-IN-PROCESS INVENTORY: Material Conversion Total Units in Ending WIP 500 350 x Cost per equivalent unit 20.50 34.20 Cost of Ending Work-in-Process inventory 10250 11970 22220

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