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Company X uses a process cost system and computes cost using the weighted avera...
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Company X uses a process cost system and computes cost using the weighted average. Direct materials are added at the 60% of the process and conversion costs are added evenly during the process. The company presented the following information:
|
Physical units
|
Degree of completion
|
|
BWIP
|
5,000
|
20%
|
|
Started in the period
|
15,000
|
|
|
Completed
|
13,000
|
|
|
EWIP
|
4,000
|
65%
|
|
|
Transferred in
|
DM
|
CC
|
Cost / EUP
|
$10
|
$12
|
$8
|
The Inspection point is at 50% of the production process. Normal
spoilage is 9,8%. The inventoriable amount in EWIP units is