Problem 3: Weighted Average Method

The May data for Thor Corporation are shown below: 

                                                                           Department A             Department B

Units started in process                                        25,000

Units received from previous department                                               15,000

Units transferred to finished goods inventory                                          7,000 

Units completed but not transferred                                                          1,000 

Ending units in process  10,000 (80% direct Materials,                          7,000 

                                             65% Conversion costs)              (75% conversion costs) 

 

Costs added by department: 

               Direct materials                                         P12, 650                           

               Direct Labor                                                   13,545                         P9,805 

               Manufacturing Overhead (applied)                5,160                          6,625

 

Required: For both departments: 

1. Compute equivalent unit of production.
2. Prepare a separate cost of production report.