The Richmond Company uses the weighted-average method in its process costing system.The company has only a single processing department.The company's ending work in process inventory on August 31 consisted of 18,000 units.The units in the ending work in process inventory were 100% complete with respect to materials and 60% complete with respect to labour and overhead.If the cost per equivalent unit for August was $2.75 for materials and $4.25 for labour and overhead,the total cost assigned to the ending work in process inventory was? (Do not round intermediate calculations)
A) $75,600.
B) $80,100.
C) $95,400.
D) $126,000.

Question

Quizplus · Accepted Answer

First, we need to calculate the equivalent units for labour and overhead using the percentage of completion provided:

Equivalent units = Ending work in process units x Percentage of completion = 18,000 x 0.6 = 10,800

Then, we can calculate the total cost assigned to the ending work in process inventory:

Total cost = (Materials cost per equivalent unit x Equivalent units) + (Labour and overhead cost per equivalent unit x Equivalent units)

Total cost = ($2.75 x 18,000) + ($4.25 x 10,800)

Total cost = $49,500 + $45,900

Total cost = $95,400

Therefore, the correct answer is C.

The Richmond Company Uses the Weighted-Average Method in Its Process