Please refer to the answers to #25. I need help with #26
25. Assigning Costs to Products: Weighted Average Method. Sydney, Inc., uses the weighted average method for its process costing system. The Assembly department at Sydney, Inc., began April with 6,000 units in work-in-process inventory, all of which were completed and transferred out during April. An additional 8,000 units were started during the month, 3,000 of which were completed and transferred out during April. A total of 5,000 units remained in work-in-process inventory at the end of April and were at varying levels of completion, as shown in the following. The following cost information is for the Assembly department at Sydney, Inc., for the month of April. Required: 1. Determine the units to be accounted for and units accounted for; then calculate the equivalent units for direct materials, direct labor, and overhead. (Hint: This requires performing step 1 of the four-step process.) - Units to be accounted for Beginning WIP inventory: 300,000 units - Units incurred during the month: 550,000 units - Total units to be accounted for 850,000 units - Units accounted for: - Units transferred out: 550,000 units - Units in ending WIP inventory: 300,000 units - Equivalent units: - Direct Materials - Units transferred out: 550,000 units - Ending WIP inventory: 300,000 units 100%=300,000 units - Total equivalent units for direct materials: 550,000 units +300,000 units =850,000 units 2. Calculate the cost per equivalent unit for direct materials, direct labor, and overhead. (Hint: This requires performing step 2 and step 3 of the four-step process.) - Direct materials: - Cost incurred during the month =$550,000 - Equivalent units =850,000 - Cost per equivalent unit for direct materials: $550,000/850,000 units =$0.647 per unit - Direct Labor and Overhead: - Cost incurred during the month: $550,000 - Equivalent units: 850,000 3. Assign costs to units transferred out and to units in ending WIP inventory. (Hint: This requires performing step 4 of the four-step process.) - Units transferred out: - Direct Materials cost: 550,000 units * $0.647 per unit =$355,850 - Direct Labor Overhead cost: 550,000 units $0.647 per unit $355,850 - Units in ending WIP inventory: Direct Materials cost: 300,000 units * $0.647 per unit =$194,100 4. Confirm that total costs to be accounted for (from step 2) equals total. costs accounted for (from step 4). Note that minor differences may occur due to rounding the cost per equivalent unit in step 3. - Total costs to be accounted for: - Direct materials: $550,000 Direct Labor and Overhead: $550,000 - Total costs accounted for: $355,850+$355,850+$194,100+$194,100= $1,099,900 - Units transferred out: Direct Materials cost: $355,850 Direct Labor and Overhead cost: $355,850 Units in ending WIP inventory: Direct Materials cost: $194,100 - Direct Labor and Overhead cost: $194,100 5. Explain the meaning of equivalent units. - Equivalent units represent the number of partially completed units multiplied by the percentage of completion. In this example, equivalent units are used to measure the amount of work done during the period, considering both fully completed units (transferred out) and partially completed units (ending WIP inventory). 26. Production Cost Report: Weighted Average Method. Refer to Exercise 25. Prepare a production cost report for Sydney, Inc., for the month of April using the format shown in Figure 3.9 "Production Cost Report for Desk Products' Assembly Department
