Data concerning the recent period’s activity in the Prep Department, the first p

Question

Data concerning the recent period’s activity in the Prep Department, the first processing department in a company that uses process costing, appears below:

Materials Conversion
Equivalent units of production in end 440 485
Cost per equivalent unit $31.55 $10.82

A total of 1,145 units were completed and transferred to the next processing department during the period.
Compute the cost of the units transferred to the next department during the period and the cost of ending work in process inventory.

Ending work in process inventory________
Units completed and transferred out_____________

Round your answer to the nearest whole number.

Explanation / Answer

1. Cost of the units transferred to next stage: Cost of the units transferred to the next department = Cost per equivalent unit x total units                                                                               = (31.55 + 10.82) x 1,145                                                                               = 42.37 x 1,145 Cost of the units transferred                                    = $48,513 Cost of the units transferred to the next department = Cost per equivalent unit x total units                                                                               = (31.55 + 10.82) x 1,145                                                                               = 42.37 x 1,145 Cost of the units transferred                                    = $48,513 2. Cost of ending works in process inventory: Material cost at the end (440 units x $31.55) = $13,882 Conversion costs at the end (485 x $10.82)   = 5247 So cost of ending works in process inventory (13,882 + 5,247) = $19,129 Material cost at the end (440 units x $31.55) = $13,882 Conversion costs at the end (485 x $10.82)   = 5247 So cost of ending works in process inventory (13,882 + 5,247) = $19,129

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