Solution Exhibit 4.22C
[AQ4]
Step 4: Summarise total costs to account for and assign these costs to units completed and units in closing work in progress using the weighted-average method, Forming Department of Sligo Toys for April 2010 (in €).
Total
production
Direct materials
Conversion costs
costs
Cost per
Cost per
Equivalent
equivalent
Total
Equivalent
equivalent
Total
units
unit
costs
units
unit
costs
(1)
(2)
(3)=(1)×(2)
(4)
(5) (6)=(4)×(5)
(7)=(3)+(6)
Panel Ab Total costs to account for Work in progress, opening
(from Solution Exhibit B) 300 25.002, 7,500 120 17.71 2,125 2,9,625 Work done in current period only
(from Solution Exhibit B) 2,200 31.82 70,000 2,005 21.20 42,000 112,500 To account for
2,500
*
31.00
*
77,500 2,125
†
21.00
†
44,625 122,125
Panel B
Assignment of costs Completed and transferred out
(18,000 physical units)
‡‡
2,000
‡
31.00 62,000
‡
2,000
‡
21.00 42,000 104,000 Work in progress, closing
(5,000 physical units 500
†
31.00 15,500
‡
125
‡
21.00 2,625 18,125 Accounted for
2,500 77,500 2,125 44,625 122,125
*
Weighted-average cost per equivalent unit of direct materials = Total direct materials costs divided by total equivalent units of direct materials = €77,500 ÷ 2,500 = €31.
†
Weighted-average costs per equivalent unit of direct materials = Total conversion costs divided by total equivalent units of conversion costs = €44,625 ÷ 2,125 = €21.
‡
From Solution Exhibit Ab FIFO
computations.
(20 min) The equivalent units of work done in the Forming Department in April 2010 for direct materials and conversion costs are the same as in problem 4.22 and are shown in Solution Exhibit A. The cost per equivalent unit of work done in the Forming Department in April 2010 for direct materials and conversion costs are calculated in problem 4.22 and Solution Exhibit B. Solution Exhibit 4.23 summarises the total Forming Department costs for April 2010, and assigns these costs to units completed (and transferred out) and units in closing work in progress under the FIFO method.
Bhimani, Horngren, Datar and Rajan, Management and Cost Accounting, 5 th Edition, Instructor’s Manual © Pearson Education Limited 2012 The cost per equivalent unit of opening stock and of work done in the current period differ Share with your friends: |
