TradeMark Inc. began the year with a beginning inventory of $3,820 in their Sewing department. Using the Weighted-Average method, they calculated their equivalent units of production for this calendar year to be:
TradeMark calculated their cost per equivalent unit as follows: Direct Material, $84; and Conversion Costs, $43. How much cost should TradeMark assign to the units remaining in ending inventory for the current calendar year?

Question

TradeMark Inc. began the year with a beginning inventory of $3,820 in their Sewing department. Using the Weighted-Average method, they calculated their equivalent units of production for this calendar year to be:
 TradeMark calculated their cost per equivalent unit as follows: Direct Material, $84; and Conversion Costs, $43. How much cost should TradeMark assign to the units remaining in ending inventory for the current calendar year?

Quizplus · Accepted Answer

This question requires assignment of costs only to the units in ending WIP inventory during the current year. Direct Materials are 150 × $84 = $12,600, and Conversion costs are 79 × $43 = $3,397. So, Total Costs = $12,600 + $3,397 = $15,997.