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    Westy Company - compute equivalent units in assembly dept

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    Westy Company manufactures cribs. Each crib passes through the assembly department and the testing department. This problem focuses on the assembly department. The process-costing system at Westy Company has a single direct-cost category (direct materials) and a single indirect-cost category (conversion costs). Direct materials are added at the beginning of the process. Conversion costs are added evenly during the process. When the assembly department finishes work on each crib, it is immediately transferred to testing.
    Westy Company uses the weighted-average method of process costing. Data for the assembly department for May 2012 are as follows:

    Physical Units (cribs) Direct Materials Conversion Costs

    Work in process 5-1-12 (1) 7,000 $1,750,000 $565,000
    Started during 5-12 22,000
    Completed during 5-12 24,500
    Work in process 5-12 4,500
    Total costs added during 5-12 $5,000,000 $2,837,500

    (1) Degree of completion: direct materials, ?%, conversion costs, 60%
    (2) Degree of completion: direct materials, ?%, conversion costs, 70%


    a) For each cost category, compute equivalent units in the assembly department. Show physical units in the first column of your schedule.

    b) For each cost category, summarize total assembly department costs for May 2012 and calculate the cost per equivalent unit.

    c) Assign total costs to units completed and transferred out and to units in ending work in process.

    d) Prepare a set of summarized journal entries for all May 2012 transactions affecting Work in Process â?" Assembly.

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    Your tutorial was created in Excel to give you a template to use for future similar problems. You can click inside the cells and see the formulas and computations. Study these to learn the technique. The journal entries are given for you and also link to the computations.