Question

Beginning work-in-process inventory was 50% complete for direct materials and direct labor costs. Ending work-inprocess inventory was 75% complete for direct materials and direct labor costs. Direct material work-in-process inventory on January 1 was $50,000. Direct material costs added during the quarter were $720,000. What is the total value of material costs in ending work-in-process inventory using the weighted-average unit cost inventory valuation method

Answer 1

Answer:

WIP ending inventory= $180,000

Explanation:

First, we need to calculate the equivalent units of production for direct materials in ending inventory.

The weighted average method blends the costs and units of the previous period with the costs and units of the current period.

Units completed in the period + Equivalent units in ending inventory WIP (units*%completion) = Equivalent units of production

Equivalent units of production= 720,000*0.75

Equivalent units of production= $540,000

Now, work in process ending inventory:

WIP ending inventory= 720,000 - 540,000

WIP ending inventory= $180,000