Byford Inc. produces a product that passes through two processes. During November, equivalent units were calculated...

 

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Byford Inc. produces a product that passes through two processes. During November, equivalent units were calculated using the weighted average method: Units completed Add: Units in EWIP x Fraction complete (60,000 x 40 percent) Equivalent units of output (weighted average) Less: Units in BWIP x Fraction complete (50,000 x 70 percent) Equivalent units of output (FIFO) 196,000 24,000 220,000 35,000 185,000 The costs that Byford had to account for during the month of November were as follows: BWIP Costs added Total $ 107 000 993,000 $1,100,000 Required: 1. Using the weighted average method, determine unit cost. 2. Under the weighted average method, what is the total cost of units transferred out? What is the cost assigned to units in ending inventory? 3. Conceptual Connection: Bill Johnson, the manager of Byford, is considering switching from Weighted Average to FIFO. Explain the key differences between the two approaches and make a recommendation to Bill about which method should be used. Byford Inc. produces a product that passes through two processes. During November, equivalent units were calculated using the weighted average method: Units completed Add: Units in EWIP x Fraction complete (60,000 x 40 percent) Equivalent units of output (weighted average) Less: Units in BWIP x Fraction complete (50,000 x 70 percent) Equivalent units of output (FIFO) 196,000 24,000 220,000 35,000 185,000 The costs that Byford had to account for during the month of November were as follows: BWIP Costs added Total $ 107 000 993,000 $1,100,000 Required: 1. Using the weighted average method, determine unit cost. 2. Under the weighted average method, what is the total cost of units transferred out? What is the cost assigned to units in ending inventory? 3. Conceptual Connection: Bill Johnson, the manager of Byford, is considering switching from Weighted Average to FIFO. Explain the key differences between the two approaches and make a recommendation to Bill about which method should be used.

Answer rating: 100% (QA)

1 Unit Cost Calculation using Weighted Average Method Total Cost BWIP Costs added 107000 993000 1100... View the full answer