Question

Vista Vacuum Company has the following production information for the month of March. All materials are added at the beginning of the manufacturing process. Units Beginning inventory of 3,300 units that are 100 percent complete for materials and 30 percent complete for conversion. 15,100 units started during the period. Ending inventory of 3,300 units that are 11 percent complete for conversion. Manufacturing Costs Beginning inventory was $20,100 ($10,500 materials and $9,600 conversion costs). Costs added during the month were $30,400 for materials and $48,500 for conversion ($27,100 labor and $21,400 applied overhead). Assume the company uses Weighted-Average Method. Required: 1. Calculate the number of equivalent units of production for materials and conversion for March. 2. Calculate the cost per equivalent unit for materials and conversion for March. 3. Determine the costs to be assigned to the units transferred out and the units still in process.

Answer 1

Answer:

1. Calculate the number of equivalent units of production for materials and conversion for March.

EUP for materials:

units completed + ending WIP = 15,100 + 3,300 = 18,500

EUP for conversion costs:

units completed + ending WIP = 15,100 + (3,300 x 11%) = 15,136.3

2. Calculate the cost per equivalent unit for materials and conversion for March.

total cost of materials = $10,500 + $30,400 = $40,900

total conversion costs = $9,600 + $48,500 = $58,100

cost per EUP for materials = $40,900 / 18,500 = $2.2108 per EUP

cost per EUP for conversion costs = $58,100 / 15,136.3 = $3.8385 per EUP

3. Determine the costs to be assigned to the units transferred out and the units still in process.

cost of transferred out units = 15,100 x ($2.2108 + $3.8385) = $91,344.43

cost of WIP = ($40,900 + $58,100) - $91,344.43 = $7,655.57