Reference no: EM1315864

Preparation of Product Cost and analyzing Wastage, Spoilage.

Frank's Chips uses the weighted-average method to account for its WIP inventories. The accounting records show the following information for a particular day:

Beginning WIP inventory:

Direct materials ...................................................... $   488

Conversion costs.....................................................      138

Current period costs in work in process

Direct materials..................................................... $5,720

Conversion costs ...................................................     3,322

Quantity information is obtained from the manufacturing records and includes the following.

Beginning inventory............................................     150 units (partially complete)

Current period units started ...............................  1,000 units

Ending inventory .................................................      300 units

Percentage of completion

Direct materials...................................          40%

Conversion costs ..................................          20%

Spot age  .............................................................        100 units

Percentage of completion

Direct materials .................................................     100%

Conversion costs ................................................       100%

Required:
Compute the cost of good units completed and transferred out, spoilage, and ending inventory using the eighted-average method.