At OxyCorp,direct materials are added at the beginning of the process and conversions costs are uniformly applied.Other details include: $\begin{array}{|l|r|}
\hline \text { WIP beginning ( } 55 \% \text { for conversion) } & 13,700 \text { units } \
\hline \text { Units started } & 125,000 \text { units } \
\hline \text { Units completed and transferred out } & 116,500 \text { units } \
\hline \text { WIP ending ( } 35 \% \text { for conversion) } & 22,200 \text { units } \
\hline \text { Beginning WIP direct materials } & \$ 50,300 \
\hline \text { Beginning WIP conversion costs } & \$ 22,500 \
\hline \text { Costs of materials added } & \$ 412,000 \
\hline \text { Costs of conversion added } & \$ 301,000 \
\hline
\end{array}$
-What is the total cost of units completed and transferred out?

Question

At OxyCorp,direct materials are added at the beginning of the process and conversions costs are uniformly applied.Other details include: $\begin{array}{|l|r|}
\hline \text { WIP beginning ( } 55 \% \text { for conversion) } & 13,700 \text { units } \
\hline \text { Units started } & 125,000 \text { units } \
\hline \text { Units completed and transferred out } & 116,500 \text { units } \
\hline \text { WIP ending ( } 35 \% \text { for conversion) } & 22,200 \text { units } \
\hline \text { Beginning WIP direct materials } & \$ 50,300 \
\hline \text { Beginning WIP conversion costs } & \$ 22,500 \
\hline \text { Costs of materials added } & \$ 412,000 \
\hline \text { Costs of conversion added } & \$ 301,000 \
\hline
\end{array}$ 
-What is the total cost of units completed and transferred out?

Quizplus · Accepted Answer

The total cost of units completed and transferred out is the sum of the beginning WIP cost, the cost of materials added, and the cost of conversion added. The beginning WIP cost is the sum of the direct materials cost and the conversion cost. The direct materials cost is $50,300 and the conversion cost is $22,500, so the beginning WIP cost is $72,800. The cost of materials added is $412,000 and the cost of conversion added is $301,000, so the total cost of units completed and transferred out is $785,800.

At OxyCorp,direct Materials Are Added at the Beginning of the Process