Question:
WEIGHTED AVERAGE METHOD, UNIT COST, VALUATION OF GOODS TRANSFERRED OUT AND ENDING WORK IN PROCESS Watson Products, Inc., produces plastic cases used for video cameras. The product passes through three departments. For May, the following equivalent units schedule was prepared for the first department:
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Direct
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Conversion
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|
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Materials
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Costs
|
|
Units completed
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5,000
|
5,000
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Units, ending work in
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|
|
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process * Percentage complete:
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6,000 * 100%
|
6,000
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-
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6,000 * 50%
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-
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3,000
|
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Equivalent units of output
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11,000
|
8,000
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Costs assigned to beginning work in process: direct materials, $30,000; conversion costs, $5,000. Manufacturing costs incurred during May: direct materials, $25,000; conversion costs, $65,000. Watson uses the weighted average method.
Required:
1. Compute the unit cost for May.
2. Determine the cost of ending work in process and the cost of goods transferred out.