Question

Highlands Company uses the weighted-average method in its process costing system. It processes wood pulp for various manufacturers of paper products.
Data relating to tons of pulp processed during June are provided below:

Percent Completed Tons of Pulp Materials Labor and Overhead Work in process, June 1 20,000 90% 80% Work in process, June 30 30,000 60% 40% Started into production during June 190,000

Required:

1.Compute the number of tons of pulp completed and transferred out during June.

2.Compute the equivalent units of production for materials and for labor and overhead for June.

Answer 1

Answer:

1. 180,000

2.  Material  198,000

    Labor OH  192,000

Explanation:

A. calculation The number of ton pulp manufactured.

Particular                                                           Unit

Work in progress on June 1                            20,000

Add: production during the month                190,000

Total process unit                                           210,000

Less: work in progress on June 30               30,000

Total unit manufacture and transfer           180,000

B. Calculation of Equivalent units.

Particular                                    Materials            Labor and Overhead

Total unit produced                     180,000                   180,000

Add: Work in progress

Material (30000*60%)                   18,000

Labor and OH (30000*40%)                                         12,000

Equivalent production                   198,000                192,000