The following information is available for Department A for the month of January:
$\begin{array}{lcc}
& \underline{\text {Units}}&
\underline{\text{cost}} \
\text { Work in process, January } 1 \text { (70\% complete) } & 10,000 & \
\text { Direct materials } & & \$ 36,000 \
\text { Direct labour } & & 18,000 \
\text { Manufacturing overhead } & &\underline{ 24,000} \
\text { Total work in process, January } 1 & &\underline{ \$ 78,000 }\
\begin{array}{l}
\text { Started in production during January } \
\text { Costs added: }
\end{array} & 40,000 & \
\text { Direct materials } & & \$ 108,000 \
\text { Direct labour } & & 48,000 \
\text { Manufacturing overhead } & &\underline{ 60,600} \
\text { Total costs added during January } & & \underline{\$ 216,600 }\
\text { Work in process, January } 31 \text { ( } 80 \% \text { complete) }&4,000
\end{array}$ Materials are added at the beginning of the process.Round unit costs to two decimal places.
-Refer to the figure.What is the cost of ending work in process using the weighted average method?
A)$16,992
B)$21,312
C)$23,760
D)$28,760

Question

The following information is available for Department A for the month of January:
$\begin{array}{lcc}
& \underline{\text {Units}}&
\underline{\text{cost}} \
\text { Work in process, January } 1 \text { (70\% complete) } & 10,000 & \
 \text { Direct materials } & & \$ 36,000 \
 \text { Direct labour } & & 18,000 \
\text { Manufacturing overhead } & &\underline{ 24,000} \
 \text { Total work in process, January } 1 & &\underline{ \$ 78,000 }\
 \begin{array}{l}
\text { Started in production during January } \
\text { Costs added: }
\end{array} & 40,000 & \
 \text { Direct materials } & & \$ 108,000 \
 \text { Direct labour } & & 48,000 \
 \text { Manufacturing overhead } & &\underline{ 60,600} \
\text { Total costs added during January } & & \underline{\$ 216,600 }\
\text { Work in process, January } 31 \text { ( } 80 \% \text { complete) }&4,000
\end{array}$ Materials are added at the beginning of the process.Round unit costs to two decimal places.
-Refer to the figure.What is the cost of ending work in process using the weighted average method?
A)$16,992
B)$21,312
C)$23,760
D)$28,760

Quizplus · Accepted Answer

To calculate the cost of ending work in process using the weighted average method, we need to calculate the equivalent units of production for direct materials and conversion costs.

For direct materials, we have 40,000 units that are 60% complete, so we have 24,000 equivalent units of production. The cost per equivalent unit for direct materials is $1.00. Therefore, the total cost for direct materials is $24,000 ($1.00 x 24,000).

For conversion costs, we have 40,000 units that are 40% complete, so we have 16,000 equivalent units of production. The cost per equivalent unit for conversion costs is $1.50. Therefore, the total cost for conversion costs is $24,000 ($1.50 x 16,000).

The cost of ending work in process is the sum of the direct materials cost and the conversion costs cost, which is $48,000 ($24,000 + $24,000).

Therefore, the correct answer is B) $21,312 (which is the nearest option).

The Following Information Is Available for Department a for the Month