Mirada Company manufactures handheld calculators and has the following informati
ID: 2331100 • Letter: M
Question
Mirada Company manufactures handheld calculators and has the following information available for the month of July: Work in process, May 1 (100% complete for July, 25% for conversion) 126,000 units Direct materials Conversion cost S 240,000 S 394,000 Number of units started 220,000 units July costs Direct materials Conversion cost S 426,000 S 484,000 Work in process, July 31 (100% complete for materials, 10% for conversion) 144,000 units Required: Using the weighted-average method of process costing, complete each of the following steps 1. Reconcile the number of physical units worked on during the period. Physical Units Physical Units Beginning Units Units Started Total Units Units Completed Ending Units Total UnitsExplanation / Answer
1 Reconcile the number of physical units worked on during the period Physical Units Physical Units Beginning Units 126000 Units Completed 202000 Units Started 220000 Ending Units 144000 Total Units 346000 Total units 346000 Units Completed = Beginning Units + Units Started - Ending Units 2 Calculate the number of equivalent units Equivalent Units Physical Units Direct Materials Conversion Units Completed 202000 202000 202000 100% Ending Inventory 144000 144000 14400 Total Units 346000 346000 216400 In Ending inventory, Materials are 100% and Conversion is 10% 3 Calculate cost per equivalent unit Direct Materials Conversion Beginning $240,000 $394,000 July Costs $426,000 $484,000 Total Costs $666,000 $878,000 Equivalent Units 346000 216400 Cost per Equivalent Unit $1.92486 $4.05730 Direct Materials Conversion Cost per Equivalent Unit $1.92486 $4.05730 4 Reconcile the total work in process Direct Materials Conversion Total Cost Units Completed $388,820.80925 $819,574.86137 1208395.67062 (202000*1.92486) (202000*4.05730) Ending Inventory $277,179.19075 $58,425.13863 335604.32938 144000*1.92486 14400*4.05730 Total Cost Accounted for 666000 878000 1544000