Kota Toy Corporation manufactures lizard dolls in two departments, Molding and Assembly. In the Molding Department, plastic is injected into a lizard-shaped mold. The dolls that come out of the molds are then transferred to the Assembly Department where hair is applied. Kota uses a weighted-average process cost system to collect costs in both departments.On January 1, the Molding Department had 4,000 dolls in process. These dolls were 100% complete with respect to direct materials and 70% complete with respect to conversion cost. During January, Molding completed 79,000 dolls. On January 31, Molding had 7,000 dolls in work in process. These dolls were 100% complete with respect to direct materials and 25% complete with respect to conversion cost.What are the Molding Department's equivalent units related to materials for January?

Question

Quizplus · Accepted Answer

Equivalent units for materials are calculated based on the units completed and transferred out plus the equivalent units in ending work in process. Since the dolls in the ending work in process are 100% complete with respect to direct materials, all units (both completed and in ending inventory) are counted as equivalent units for materials. Therefore, the equivalent units for materials are 79,000 (completed and transferred out) + 7,000 (ending inventory) = 86,000.

Kota Toy Corporation Manufactures Lizard Dolls in Two Departments, Molding