Question $3$: Process Costing and Ethics

$[43$ marks$]$

Question $3$ has three parts, Parts A$,$ B$,$ and C$.$ ALL are compulsory.

Part A $-$ Weighted Average Method

Meow Cat Food Ltd$\text{'}$s division A produces canned cat food in standard sizes. Set out below is information for the month of January:

Work$-$in$-$process inventory, $1$ January

Direct materials: $100\%$ complete

Conversion: $50\%$ complete

Units started during January

Units completed and transferred out during January

Work$-$in$-$process inventory, $31$ January

Direct materials: $100\%$ complete

Conversion costs: $50\%$ complete

Costs incurred during January

Direct materials

Conversion

$8,000$ units

$$12,000$

$$24,000$

$16,000$ units

$16,000$ units

$$24,000$

$$256,000$

Required: Show ALL your workings.

Applying the weighted average method complete the following:

$($i$)$ Calculate equivalent units of direct materials and conversion for the month of January. $(4$ marks$)$

$($ii$)$ Calculate direct material cost and conversion cost per equivalent unit for the month of January.

$(8$ marks$)$

$($iii$)$ Prepare an analysis of total costs showing the cost of goods completed and transferred out during January and cost of WIP inventory on $31$ January, as per Exhibit $5\mathrm{.}4($p$\mathrm{.}183)$ of the textbook.

$(4$ marks$)$

$6$