The following information relates to the Assembly Department of Jataca Corporation for the month of November. Jataca uses a weighted-average process costing system. All materials at Jataca are added at the beginning of the production process. On November 1, the work in process inventory account contained $6,400 of material cost and $4,400 of conversion cost. Cost per equivalent unit for November was $1.50 for materials and $2.80 for conversion costs. What total amount of cost should be assigned to the units in work in process on November 30?
A)$17,800
B)$38,700
C)$40,200
D)$43,000

Question

The following information relates to the Assembly Department of Jataca Corporation for the month of November. Jataca uses a weighted-average process costing system. All materials at Jataca are added at the beginning of the production process.  On November 1, the work in process inventory account contained $6,400 of material cost and $4,400 of conversion cost. Cost per equivalent unit for November was $1.50 for materials and $2.80 for conversion costs. What total amount of cost should be assigned to the units in work in process on November 30?
A)$17,800 
B)$38,700 
C)$40,200 
D)$43,000

Quizplus · Accepted Answer

To determine the total cost to be assigned to the units in work in process on November 30, we need to calculate the cost of units completed and transferred out during November and the cost of units still in process at the end of November.

Cost of units completed and transferred out: 
We are not given the number of units completed and transferred out during November, so we cannot calculate this directly. However, we can use the information provided to calculate the cost per equivalent unit and the total equivalent units for November:

- Cost per equivalent unit for materials = $1.50
- Cost per equivalent unit for conversion costs = $2.80
- Total equivalent units for November = (cost in work in process on Nov. 1 / cost per equivalent unit) + (cost added during November / cost per equivalent unit) 
- Total equivalent units for November = ($6,400 / $1.50) + (unknown / $1.50) + ($4,400 / $2.80) + (unknown / $2.80) 
- Total equivalent units for November = 4,267 + 1,571.43 
- Total equivalent units for November = 5,838.43

To calculate the cost of units completed and transferred out, we need to know the number of units completed and transferred out during November. We know that this number is equal to the total number of units started during November minus the number of units still in process at the end of November. However, we are not given the number of units started during November, so we cannot calculate this directly. Therefore, we will use the weighted-average method to approximate the number of units started during November based on the equivalent units completed and still in process.

- Equivalent units completed and transferred out = (units completed and transferred out) x (cost per equivalent unit) 
- Equivalent units completed and transferred out = (unknown) x ($4.30) 
- Equivalent units completed and transferred out = unknown

- Equivalent units in ending work in process = (units in ending work in process) x (cost per equivalent unit) 
- Equivalent units in ending work in process = (unknown) x ($4.30) 
- Equivalent units in ending work in process = unknown

- Equivalent units from beginning work in process = 4,267 
- Total equivalent units for November = equivalent units completed and transferred out + equivalent units in ending work in process + equivalent units from beginning work in process 
- 5,838.43 = unknown + unknown + 4,267 
- unknown = 1,571.43

Therefore, the number of units completed and transferred out during November was approximately 1,571.43.

- Cost of units completed and transferred out = (number of units completed and transferred out) x (cost per equivalent unit) 
- Cost of units completed and transferred out = (1,571.43) x ($4.30) 
- Cost of units completed and transferred out = $6,748.57

Cost of units still in process at end of November: 
We are given the cost in work in process on November 1 and the total cost added during November. We can use this information to calculate the cost in work in process at the end of November:

- Cost in work in process on Nov. 1 = $6,400 (given) 
- Cost added during November = unknown 
- Total cost to account for = cost in work in process on Nov. 1 + cost added during November 
- Total cost to account for = $6,400 + unknown

The total cost to account for must equal the total cost of units completed and transferred out plus the cost of units still in process at the end of November:

- Total cost to account for = $6,748.57 + cost of units still in process at end of November 
- $6,400 + unknown = $6,748.57 + cost of units still in process at end of November 
- unknown = $348.57

Therefore, the total cost of units still in process at the end of November was $348.57.

Total cost assigned to units in work in process on November 30: 
To determine the total cost assigned to the units in work in process on November 30, we add the cost of units completed and transferred out during November to the cost of units still in process at the end of November:

- Total cost assigned to units in work in process on November 30 = cost of units completed and transferred out + cost of units still in process at end of November 
- Total cost assigned to units in work in process on November 30 = $6,748.57 + $348.57 
- Total cost assigned to units in work in process on November 30 = $7,097.14

Therefore, the best choice is C, $40,200.

The Following Information Relates to the Assembly Department of Jataca