Problem:
Weighted-average method, assigning costs. Bio Doc Corporation is a biotech company based in Milpitas. It makes a cancer-treatment drug in a single processing department. Direct materials are added at the start of the process. Conversion costs are added evenly during the process. Bio Doc uses the weighted average method of process costing. The following information for July 2011 is available.
|
Equivalent Units
|
|
Physical Units
|
Direct Materials
|
Conversion Costs
|
|
Work in process, July 1
|
8,500
|
8,500
|
1,700
|
|
Started during July
|
35,000
|
|
|
|
Completed and transferred out during July
|
33,000
|
33,000
|
33,000
|
|
Work in process, July 31
|
10,500
|
10,500
|
6,300
|
|
Total Costs for July 2008
|
|
Work in process, beginning
|
|
|
|
Direct materials
|
$63,100
|
|
|
Conversion costs
|
45,510
|
$108,610
|
|
Direct materials added during July
|
|
284,900
|
|
Conversion costs added during July
|
|
485,040
|
|
Total costs to account for
|
|
$878,550
|
1. Calculate cost per equivalent unit for direct materials and conversion costs.
2. Summarize total costs to account for, and assign total costs to units completed (and transferred out) and to units in ending work in process.