**Weighted-Average Process Costing in Manufacturing** A manufacturing company applies the weighted-average method within its process costing system. Below is the operating data for the first processing department from a recent period, detailing the number of units, direct material (DM) costs, and conversion costs (CC). **Production Data:** | Description | Units | % Completion (DM) | % Completion (CC) | |---------------------------------------------------|-------|-------------------|-------------------| | Beginning work in process (WIP) inventory | 1,200 | 20% | 50% | | Started into production during the period | 12,000| | | | Units completed and transferred out | 12,200| | | | Ending WIP inventory | ??? | 60% | 80% | **Cost Data:** | Description | DM | CC | |---------------------------|--------|---------| | Beginning WIP inventory | $12,320| $22,660 | | Cost added during the period | $32,480| $61,840 | **Question:** Under the weighted-average method, what is the total cost of the ending work in process inventory? **Explanation:** The tables above present critical information for calculating costs using the weighted-average method. The production data table outlines the workflow stages, including inventory levels and completion percentages for direct materials and conversion costs. The cost data provides the monetary values for materials and labor at the start of the period and additional expenses incurred. The missing number of units for the ending WIP inventory can be derived from the provided data. The percentages indicate how complete the ending inventory is in terms of material and labor, which is essential for accurate cost calculation in a continuous production process.
**Weighted-Average Process Costing in Manufacturing** A manufacturing company applies the weighted-average method within its process costing system. Below is the operating data for the first processing department from a recent period, detailing the number of units, direct material (DM) costs, and conversion costs (CC). **Production Data:** | Description | Units | % Completion (DM) | % Completion (CC) | |---------------------------------------------------|-------|-------------------|-------------------| | Beginning work in process (WIP) inventory | 1,200 | 20% | 50% | | Started into production during the period | 12,000| | | | Units completed and transferred out | 12,200| | | | Ending WIP inventory | ??? | 60% | 80% | **Cost Data:** | Description | DM | CC | |---------------------------|--------|---------| | Beginning WIP inventory | $12,320| $22,660 | | Cost added during the period | $32,480| $61,840 | **Question:** Under the weighted-average method, what is the total cost of the ending work in process inventory? **Explanation:** The tables above present critical information for calculating costs using the weighted-average method. The production data table outlines the workflow stages, including inventory levels and completion percentages for direct materials and conversion costs. The cost data provides the monetary values for materials and labor at the start of the period and additional expenses incurred. The missing number of units for the ending WIP inventory can be derived from the provided data. The percentages indicate how complete the ending inventory is in terms of material and labor, which is essential for accurate cost calculation in a continuous production process.
Chapter1: Financial Statements And Business Decisions
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Transcribed Image Text:**Weighted-Average Process Costing in Manufacturing**
A manufacturing company applies the weighted-average method within its process costing system. Below is the operating data for the first processing department from a recent period, detailing the number of units, direct material (DM) costs, and conversion costs (CC).
**Production Data:**
| Description | Units | % Completion (DM) | % Completion (CC) |
|---------------------------------------------------|-------|-------------------|-------------------|
| Beginning work in process (WIP) inventory | 1,200 | 20% | 50% |
| Started into production during the period | 12,000| | |
| Units completed and transferred out | 12,200| | |
| Ending WIP inventory | ??? | 60% | 80% |
**Cost Data:**
| Description | DM | CC |
|---------------------------|--------|---------|
| Beginning WIP inventory | $12,320| $22,660 |
| Cost added during the period | $32,480| $61,840 |
**Question:**
Under the weighted-average method, what is the total cost of the ending work in process inventory?
**Explanation:**
The tables above present critical information for calculating costs using the weighted-average method. The production data table outlines the workflow stages, including inventory levels and completion percentages for direct materials and conversion costs. The cost data provides the monetary values for materials and labor at the start of the period and additional expenses incurred.
The missing number of units for the ending WIP inventory can be derived from the provided data. The percentages indicate how complete the ending inventory is in terms of material and labor, which is essential for accurate cost calculation in a continuous production process.
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