Try It! 17-2

The Stanton Processing COmpany had work in process at the beginning and end of March 2017 in its Painting Department as follows:

March 1   (3000 Units) [40%|10%]
March 31 (2000 Units) [80%|40%]

The company completed 30,000 units during March. Manufacturing costs incurred during March were direct materials costs of $176,320 and conversion costs of $312,625. Inventory at March 1 was carried at a cost of $16,155 (direct materials, $5,380 and conversion costs, $10,775).

Assuming Stanton uses weighted-average costing, determine the equivalent units of work done in March, and calculate the cost of units completed and the cost of units in ending inventory.

Physical Units:
3,000 Beginning
X Started
30,000 Completed
2,000 Ending

X=29,000 Started

Equivalent Units:

30,000 [100%|100%]
  2,000 [80%  |  40%]
[31,600 | 30,800]

Total Costs:
Started: [$176,000 | $312,625]
WIP:     [    $5,380 |   $10,775]
Total:    [$181,380 | $323,400]

Total Cost/Equivalent Units:
[$181,380 | $323,400] / [31,600 | 30,800]
[$5.74 | $10.50]

Allocate Costs:
30,000 [30,000 | 30,000]
  2,000 [  1,600 |      800]
30,000 [$172,200 | $315,000]
  2,000 [    $9,184 |     $8,400] (minor rounding error in allocated WIP Direct Materials)