Exercise 4-8_ Grand River Company_ weighted – average method
Grand River Company produces a high quality insulation material that passes through two production process. Data for November for the first process follows:
Units Completion with respect to
Work in process inventory, Nov. 1 80,000 50% 25%
Work in process inventory, Nov. 30 60,000 45% 20%
Material cost in Work in process inventory, Nov. 1 $76,600
Conversion cost in Work in process inventory, Nov. 1 $34,900
Units started into production 300,000
Units transferred to the next process 320,000
Materials cost added during Nov. $410,000
Conversion cost added during Nov. $234,500
1. Assume that the company uses the weighted – average method of accounting for units and costs. Determine the equivalent units for November for the first process.
2. Compute the costs per equivalent unit for November for the first process.
3. Determine the total costs of ending work in process inventory and the total costs of units transferred to the next process in November.