Tambin Inc. produces a gasoline additive that, when added to the gas tank of the average automobile, is designed to increase gas mileage by 20%. The companys controller suspects that the year-end dollar balances shown below in the inventory accounts may be incorrect.

Units Costs

Work in process, December 31 (materials 100% complete; conversion 60% complete) 26,000 $ 61,000

Finished goods, December 31 31,000 $ 114,500

There were no finished goods inventories at the beginning of the year. The company uses the weighted-average method of process costing. There is only one processing department.

A review of the companys inventory and cost records shows the following:

Costs Units Materials Conversion Work in process, beginning of year (materials 100% complete; conversion 50% complete) 21,000 $ 23,000 $ 49,000 Started into production 601,000 Costs added during the year $ 751,000 $ 2,010,000 Units completed during the year 690,000

Required:

1. Determine the equivalent units and the costs per equivalent unit for materials and conversion for the year

2.Determine the amount of cost that should be assigned to the ending work in process and finished goods inventories.

3. Prepare the necessary correcting journal entry to adjust the work in process and finished goods inventories to the correct balances as of December 31.