The Stanton Processing Company had work in process at the beginning and end of March 2017 in its Painting Department as follows:

Percentage of Completion

Direct Materials Conversion Costs

March 1 (3,000 units) 40% 10%

March 31 (2,000 units) 80% 40%

The company completed 30,000 units during March. Manufacturing costs incurred during March were direct materials costs of $ 176,320 and conversion costs of $ 312,625. Inventory at March 1 was carried at a cost of $ 16,155 (direct materials, $5,380 and conversion costs, $10,775).

Required

1.Assuming Stanton uses weighted-average costing, determine the equivalent units of work done in March, and calculate the cost of units completed and the cost of units in ending inventory.

2. Assuming co. is using FIFO method. Calculate cost of units completed and cost of ending inventory.

Exercise

Azure Textiles Company makes silk banners and uses the weighted-average method of process costing. Direct materials are added at the beginning of the process, and conversion costs are added evenly during the process. Spoilage is detected upon inspection at the completion of the process. Spoiled units are disposed of at zero net disposal value.

	Direct Material	Conversion Cost	Total
Beginning WIP	1000	100%	50%
Started in July 2017	?
Good units completed and transferred -out	9000
Normal spoilage	100
Abnormal spoilage	50
Ending WIP July 31	2000	100%	30%

Determine the equivalent units of work done in July, and calculate the cost of units completed and transferred out (including normal spoilage), the cost of abnormal spoilage, and the cost of units in ending inventory.