Kidd Company uses a process cost system and the weighted average method.The company had 800 units of product in its work in process inventory at the beginning of the period.During the period 3,000 additional units of product were started.At the end of the period there were 1,500 units of product in the work in process account.The ending work in process inventory was estimated to be 30% complete.The beginning work in process inventory had a balance of $4,000.Product costs totalingThere were $84,000 of product costs were added to work in process during the period.The amount of cost in ending work in process inventory is:
A) $33,600.
B) $48,000.
C) $14,400.
D) $8,400.

Question

Quizplus · Accepted Answer

Units in beginning work in process + Units started = Units finished and transferred out + Units in ending inventory
800 + 3,000 = Units finished and transferred out + 1,500
Units finished and transferred out = 800 + 3,000 - 1,500 = 2,300
Weighted average method:
Total equivalent units = Units finished and transferred out + (Ending inventory x Percentage complete)
Total equivalent units for the period = 2,300 units + (1,500 units x 0.30)= 2,750
Cost per equivalent unit = Total product costs in department ÷ Equivalent whole units
Cost per equivalent unit = ($4,000 + $84,000)÷ 2,750 Equivalent whole units = $32
Cost of ending inventory = (Units in ending inventory x Percentage complete)x Cost per equivalent unit
Cost of ending inventory = (1,500 units x 0.30)x $32 per unit = $14,400

Kidd Company Uses a Process Cost System and the Weighted