Because most of the parts for its irrigation systems are standard, Waterways han
ID: 2497596 • Letter: B
Question
Because most of the parts for its irrigation systems are standard, Waterways handles the majority of its manufacturing as a process cost system. There are multiple process departments. Three of these departments are the Molding, Cutting, and Welding departments. All items eventually end up in the Package department which prepares items for sale in kits or individually.
The following information is available for the Molding department for January.
10%
Show the equivalent units for materials and conversion costs if Waterways used FIFO instead of weighted-average.
Work in process beginning: Units in process 22,000 Stage of completion for materials 80% Stage of completion for labor and overhead 30% Costs in work in process inventory: Materials $168,360 Labor 67,564 Overhead 17,270 Total costs in beginning work in process $253,194 Units started into production in January 60,000 Units completed and transferred in January 58,000 Costs added to production: Materials $264,940 Labor 289,468 Overhead 60,578 Total costs added into production in January $614,986 Work in process ending: Units in process 24,000 Stage of completion for materials 50% Stage of completion for labor and overhead10%
Show the equivalent units for materials and conversion costs if Waterways used FIFO instead of weighted-average.
Explanation / Answer
Beginning WIP 22,000 Units completed & transferred 58,000 Units started int production 60,000 Ending WIP 24,000 Units to be accounted for 82,000 Units accounted for 82,000 Physical units Materials Conversion cost Beginning WIP 22,000 4400(20%) 15,400(70%) Units completed & transferred 36,000 36,000(100%) 36,000(100%) Ending WIP 24,000 12,000(50%) 2,400(10%) Equivalent units 52,400 53,800