Question

Department G had 1,920 units 25% completed at the beginning of the period, 13,500 units were completed during the period, 1,600 units were 20% completed at the end of the period, and the following manufacturing costs debited to the departmental work in process account during the period:

Work in process, beginning of period	$26,300
Costs added during period:
Direct materials (13,180 units at $8)	105,440
Direct labor	85,200
Factory overhead	28,400

All direct materials are placed in process at the beginning of production and the first-in, first-out method of inventory costing is used. The total cost of 1,920 units of beginning inventory which were completed during the period is (do not round unit cost calculations)

$26,300

$40,163

$38,563

$36,110

Answer 1

Equivalent units for conversion costs = ( beginning inventory x Percent completed During Current Year) + Units started and completed during the period + (ending inventory x percent completed)

= (1920*75%) + (13500-1920) + (1600*20%)

= 13340 units

Cost per equivalent unit for conversion costs = Conversion costs incurrred during the current period / Equivalent units for conversion costs

= (85200+28400)/ 13340

= $8.5157

Inventory costing = Beginning Work in process cost + cost incurred during the year

= $26300 + 1920*$8.5157*75%

= $38562.6 or $38563( rounded off)

Since material was added in the beginning we will not add.

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