WA EUP For each of the following situations

WA EUP For each of the following situations, use the weighted average method to determine the equivalent units of production for labor and overhead assuming that they are continuously at the same percentage of completion a Being WP Inventory (40% complet 3.000 Units started in production 200,000 Units transferred out 275.200 Erding Womentory (0 complet 12.800 FU of production 32.000 OD Beginning witory.com Units started in production Unes transferred Ending wipinventory.com of production 2000 A 12.000 34000 33740 Beginning WIP ventory complete Units started in production Uniteved out Endine Wory on complete u of production d Inning windory is completa Ut started in production un transferred out Ending Winventory complete EU of production SO 6 WA EUP For each of the following situations use the weighted average method to determine the equivalent units of production for labor and overhead, assuming that they are continuously at the same percentage of completion R, Ben WP.com Used in production witstransferred but Ending Pinoy.com 12.00 Puof production 3.000 200.000 20141200 O Beghning WP inventory.completel Units started in production Units transferred out Ending WP inventory 100% complete EU of production 2000 384.000 7 20.800 o Begining WP invece complet Units started in production wits transferred Endir Winery.com U reduction 12.000 324.000 22540 7 0 Begini Pwy.com LAIS din production Un tasarred out Ending Winwory 46.com Eu of production 2 261 290 14,640

The Correct Answer and Explanation is :

To determine the equivalent units of production (EUP) for labor and overhead using the weighted average method, we follow these steps:

Calculate Total Units to Account For:

Beginning Work in Process (WIP) Inventory: Units that were not completed in the previous period.
Units Started During the Period: New units introduced into production.

Calculate Total Units Accounted For:

Units Completed and Transferred Out: Units finished during the period.
Ending WIP Inventory: Units that are still in process at the end of the period.

Compute Equivalent Units:

For Units Completed and Transferred Out: These are considered 100% complete for labor and overhead.
For Ending WIP Inventory: Multiply the number of units by their percentage of completion for labor and overhead.

Let’s apply this method to each scenario:

Beginning WIP Inventory: 3,000 units (40% complete)
Units Started During the Period: 200,000 units
Units Completed and Transferred Out: 275,200 units
Ending WIP Inventory: 12,800 units (0% complete)

Calculation:

Total Units to Account For:
Beginning WIP + Units Started = 3,000 + 200,000 = 203,000 units
Total Units Accounted For:
Units Transferred Out + Ending WIP = 275,200 + 12,800 = 288,000 units Note: There’s a discrepancy since 288,000 units accounted for exceeds the 203,000 units to account for. This suggests possible data inconsistency.
Equivalent Units for Labor and Overhead:
Units Transferred Out: 275,200 units × 100% = 275,200 EUP
Ending WIP: 12,800 units × 0% = 0 EUP
Total EUP: 275,200 + 0 = 275,200

Beginning WIP Inventory: 2,000 units (60% complete)
Units Started During the Period: 34,000 units
Units Completed and Transferred Out: 33,740 units
Ending WIP Inventory: 2,260 units (0% complete)

Calculation:

Total Units to Account For:
Beginning WIP + Units Started = 2,000 + 34,000 = 36,000 units
Total Units Accounted For:
Units Transferred Out + Ending WIP = 33,740 + 2,260 = 36,000 units
Equivalent Units for Labor and Overhead:
Units Transferred Out: 33,740 units × 100% = 33,740 EUP
Ending WIP: 2,260 units × 0% = 0 EUP
Total EUP: 33,740 + 0 = 33,740

Beginning WIP Inventory: 5,000 units (50% complete)
Units Started During the Period: 384,000 units
Units Completed and Transferred Out: 376,800 units
Ending WIP Inventory: 12,200 units (0% complete)

Calculation:

Total Units to Account For:
Beginning WIP + Units Started = 5,000 + 384,000 = 389,000 units
Total Units Accounted For:
Units Transferred Out + Ending WIP = 376,800 + 12,200 = 389,000 units
Equivalent Units for Labor and Overhead:
Units Transferred Out: 376,800 units × 100% = 376,800 EUP
Ending WIP: 12,200 units × 0% = 0 EUP
Total EUP: 376,800 + 0 = 376,800

Beginning WIP Inventory: 12,000 units (30% complete)
Units Started During the Period: 324,000 units
Units Completed and Transferred Out: 322,540 units
Ending WIP Inventory: 13,460 units (0% complete)

Calculation:

Total Units to Account For:
Beginning WIP + Units Started = 12,000 + 324,000 = 336,000 units
Total Units Accounted For:
Units Transferred Out + Ending WIP = 322,540 + 13,460 = 336,000 units
Equivalent Units for Labor and Overhead:
Units Transferred Out: 322,540 units × 100% = 322,540 EUP
Ending WIP: 13,460 units × 0% = 0 EUP
Total EUP: 322,540 + 0 = 322,540

Beginning WIP Inventory: 2,000 units (20% complete)
Units Started During the Period: 261,290 units
Units Completed and Transferred Out: 246,650 units
Ending WIP Inventory: 16,640 units (0% complete)

Calculation:

Total Units to Account For:
Beginning WIP + Units Started = 2,000 + 261,290 = 263,290 units
Total Units Accounted For:
Units Transferred Out + Ending WIP = 246,650 + 16,640 = 263,290 units
Equivalent Units for Labor and Overhead:
Units Transferred Out: 246,650 units × 100% = 246,650 EUP
Ending WIP: 16,640 units × 0% = 0 EUP
Total EUP: 246,650 + 0 = 246,650

Explanation:

The weighted average method combines units and costs from both the current and previous periods to compute an average cost per unit. This method doesn’t distinguish between work done in prior periods and the current period. To calculate the equivalent units of production for labor and overhead:

Units Completed and Transferred Out: These units are always considered 100% complete concerning labor and overhead since they’ve finished the production process.
Ending WIP Inventory: For units still in process, we assess their stage of completion. In these scenarios, the ending WIP units are 0% complete for labor and overhead, contributing 0 equivalent units.

By summing the equivalent units from both completed units and ending WIP, we determine the total EUP for labor and overhead. This approach provides a comprehensive view of the production activity and aids in accurately assigning costs to units based on the work performed during the period.

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