Exercise 4-6 Equivalent Units and Cost per Equivalent Unit-Weighted-Average Method [LO2, LO3]

Kalox, Inc., manufactures an antacid product that passes through two departments. Data for May for the first department follow:

	Gallons	Materials		Labor		Overhead
Work in process, May 1	77,000	$	68,900	$	31,500	$	43,500
Gallons started in process	729,000
Gallons transferred out	750,000
Work in process, May 31	56,000
Cost added during May		$	911,380	$	388,700	$	537,140

The beginning work in process inventory was 70% complete with respect to materials and 55% complete with respect to labor and overhead. The ending work in process inventory was 50% complete with respect to materials and 25% complete with respect to labor and overhead.

Required:

Assume that the company uses the weighted-average method of accounting for units and costs.

1.	Compute the equivalent units for Mays activity for the first department.

	Materials	Labor	Overhead
Equivalent units of production (Gallons)

2.	Determine the costs per equivalent unit for May. (Round your answers to 2 decimal places.)

	Materials	Labor	Overhead
Cost per equivalent unit	$	$	$

Exercise 4-9 Cost Assignment; Cost Reconciliation-Weighted-Average Method [LO2, LO4, LO5]

Kenton Industrial Corporation uses the weighted-average method in its process costing system. During April, the Baker Assembly Department completed its processing of 25,800 units and transferred them to the next department. The cost of beginning inventory and the costs added during April amounted to $696,860 in total. The ending inventory in April consisted of 2,800 units, which were 80% complete with respect to materials and 60% complete with respect to labor and overhead. The costs per equivalent unit for the month were as follows:

	Materials		Labor		Overhead
Cost per equivalent unit	$	12.70	$	4.70	$	7.70

Required:

1.	Compute the equivalent units of materials, labor, and overhead in the ending work in process inventory for the month.

	Materials	Labor	Overhead
Equivalent units in ending work in process inventory

2.	Compute the cost of ending work in process inventory and of the units transferred to the next department for April.

	Materials	Labor	Overhead	Total
Cost of ending work in process inventory	$	$	$	$
Cost of units completed and transferred out	$	$	$	$

3.	Prepare a cost reconciliation for April. (Note: You will not be able to break the cost to be accounted for into the cost of beginning inventory and costs added during the month.)

Cost Reconciliation
Total cost to be accounted for	$
Total costs accounted for as follows:
(Click to select)Cost of beginning work in process inventoryCosts added to production during the periodCost of ending work in process inventory	$
(Click to select)Cost of units completed and tranferred outCosts added to production during the periodCost of beginning work in process inventory
Total cost accounted for	$