Williams Company computed its cost per equivalent unit for direct materials to be $2.60 and its cost per equivalent unit for conversion to be $3.75.A total of 250,000 units of product were completed and transferred out as finished goods during the month.The ending Work in Process inventory consists of 36,000 equivalent units of direct materials and 36,000 equivalent units of conversion costs.The amount that should be reported in ending Work in Process Inventory is:
A)$93,600.
B)$135,000.
C)$1,816,100.
D)$1,587,500.
E)$228,600.

Question

Quizplus · Accepted Answer

The ending Work in Process Inventory is calculated by adding the cost of direct materials and conversion costs for the equivalent units in ending inventory. For direct materials: 36,000 units * $2.60 = $93,600. For conversion costs: 36,000 units * $3.75 = $135,000. Total ending Work in Process Inventory = $93,600 + $135,000 = $228,600.

Williams Company Computed Its Cost Per Equivalent Unit for Direct