Question Completion:
Victory Company uses weighted-average process costing to account for its production costs. Conversion cost is added evenly throughout the process. Direct materials are added at the beginning of the process.
Answer:
Victory Company
Direct Materials Conversion
Equivalent units 886,000 795,500
Explanation:
a) Data and Calculations:
Direct Materials Conversion Cost
Beginning WIP Inventory $460,720 $178,988
Costs added in November 3,083,280 3,400,762
Total costs of production $3,544,000 $3,579,750
Production Process:
Beginning Inventory = 61,000
Started and completed 644,000
Units transferred out = 705,000
Ending WIP inventory 181,000
Units under process 886,000
Equivalent units of production:
Direct Materials Conversion
Units transferred out 705,000 (100%) 705,000 (100%)
Ending WIP Inventory 181,000 (100%) 90,500 (50%)
Total equivalent units 886,000 795,500
