61. Portal Manufacturing, which began business in 1956, uses a weighted-average processcosting system.

The following figures pertain to July:

All materials are introduced at the start of the process, and conversion cost is incurred evenly throughout production. The company used direct materials that cost $640,000; conversion amounted to $8 per equivalent unit. Required: A. Calculate the direct materials cost per equivalent unit. B. Calculate the cost of units completed and transferred. C. What percentage of conversion work will be performed on the 40,000-unit ending work-inprocess inventory during August? D. In all likelihood, were all of the 120,000 completed units begun in July? Explain. A. $640,000 B. 120,000 (120,000 + 40,000) = $4 ($4 + $8) = $1,440,000 40,000) of the work was performed in July, leaving 55% for

C. Forty-five percent (18,000 August.

D. No. In a continuous processing environment, the beginning work-in-process inventory is often the first batch of goods to be completed. These units entered production in a previous month.

AACSB: Analytic AICPA BB: Critical Thinking AICPA FN: Measurement Bloom's: A, N Difficulty: Hard Learning Objective: 3 Learning Objective: 4 Learning Objective: 5

62. Federal, Inc., uses a weighted-average process-costing system and has one production department. All materials are introduced at the start of manufacturing; in contrast, conversion cost is incurred uniformly throughout production. The company had respective work-inprocess inventories on May 1 and May 31 of 62,000 units and 70,000 units, the latter of which was 40% complete. The production supervisor noted that Federal completed 100,000 units during the month. Costs in the May 1 work-in-process inventory were subdivided as follows: materials, $40,000; conversion, $90,000. During May, Federal charged production with $300,000 of material and $710,000 of conversion, resulting in a material cost per equivalent unit of $2. Required: A. Determine the number of units that Federal started during May. B. Compute the number of equivalent units with respect to conversion cost. C. Determine the conversion cost per equivalent unit. D. Compute the cost of the May 31 work-in-process inventory. E. What account would have been credited to record Federal's completed production? A. Since Federal had accounted for 170,000 units (100,000 + 70,000), the company must have started 108,000 units in May (170,000 62,000). B. Equivalent units for conversion cost total 128,000 [100,000 + (70,000 C. The conversion cost per equivalent unit is $6.25 [($90,000 + $710,000) D. Ending work in process totals $315,000: materials, $140,000 (70,000 conversion, $175,000 [(70,000 40%) $6.25]. E. Work-in-Process Inventory 40%)]. 128,000 units]. $2.00) +

AACSB: Analytic AICPA BB: Critical Thinking AICPA FN: Measurement Bloom's: RC, A Difficulty: Hard Learning Objective: 2 Learning Objective: 3 Learning Objective: 4 Learning Objective: 5

63. Manhattan, Inc., uses a weighted-average process-costing system. All materials are introduced at the beginning of production; conversion cost is incurred evenly throughout manufacturing. The following information pertains to April:

The company's accountant has already computed the cost per equivalent unit, as follows: materials, $5; conversion, $14. Required: Calculate the cost of goods completed during April and the cost of the ending work-in-process inventory. Cost of goods completed: 53,000 ($5 + $14) = $1,007,000 Cost of ending work in process: (12,000 $5) + (12,000 30%

$14) = $110,400

AACSB: Analytic AICPA BB: Critical Thinking AICPA FN: Measurement Bloom's: A Difficulty: Hard Learning Objective: 3 Learning Objective: 5

64. Marcus Corporation, which uses the weighted-average method of process costing, reported the following as of February 1:

Conversations with the production supervisor revealed that materials are introduced at the start of the process and conversion cost is incurred evenly throughout manufacturing. The company started 29,000 units during the month. Goods in process at the beginning and end of February totaled 3,000 units and 5,000 units, respectively, the latter batch being 60% complete. Just prior to leaving on vacation, a trusted staff assistant was asked to compute the cost of February's ending work-in-process inventory. Her calculations showed a huge rise in unit cost when compared with the February 1 figures, soaring to $250 [($470,000 + $280,000) 3,000 units (5,000 units 60%)]. Required: A. Did the staff assistant make any errors in her calculations? Explain. B. Analyze the company's production volume and determine the proper equivalent-unit figures for February. C. Calculate the proper unit costs for February. D. Calculate the cost of the February 28 work-in-process inventory.

A. Yes, the assistant made several errors. Unit costs under the weighted-average method are derived by combining the beginning work-in-process costs with costs of the current month, and the assistant used only the latter. Additionally, she ignored units completed during February and incorrectly spread materials cost in the ending work-in-process inventory over 3,000 units rather than the correct figure of 5,000 units. B. Units completed: 27,000 (3,000 + 29,000 - 5,000) Equivalent unitsmaterials: 32,000 (27,000 + 5,000) Equivalent unitsconversion cost: 30,000 [27,000 + (5,000

60%)]

C. Cost per equivalent unitmaterials: $16 [($42,000 + $470,000) 32,000] units Cost per equivalent unitconversion cost: $10 [($20,000 + $280,000) 30,000] units D. The ending work-in-process inventory consists of materials (5,000 units $16 = $80,000) and conversion cost (3,000 units $10 = $30,000), for a total of $110,000.

AACSB: Reflective Thinking AICPA BB: Critical Thinking AICPA FN: Measurement Bloom's: A, N Difficulty: Hard Learning Objective: 3 Learning Objective: 4 Learning Objective: 5

65. Edwards Company had a beginning work-in-process inventory of 30,000 units on June 1. These units contained $120,000 of direct materials and $272,000 of conversion cost. The following data relate to activity during June:

Edwards uses a weighted-average process-costing system. All materials are added at the start of manufacturing; in contrast, conversion cost is incurred evenly throughout production. Required: A. Compute the total equivalent units for direct material and conversion cost. B. Compute the cost per equivalent unit of direct material and conversion cost. C. Determine the cost of completed production. D. Determine the cost of the June 30 work in process.

AACSB: Analytic AICPA BB: Critical Thinking AICPA FN: Measurement Bloom's: A Difficulty: Hard Learning Objective: 3 Learning Objective: 4 Learning Objective: 5