Question

The following is an account for a production department, showing its costs for one month: Work in Process Inventory Beginning Balance 5,600 Completed and transferred out 50,010 Direct materials 21,800 Direct labor 16,400 Overhead 11,000 Ending Balance 4,790 Assume that materials are added at the beginning of the production process and that direct labor and overhead are applied uniformly. If the started and completed units cost $42,050, what was the cost of completing the units in the beginning Work in Process inventory?

Answer 1

Answer: $7,960

Explanation:

Given that,

Beginning WIP Inventory balance = 5,600

Completed and transferred out = 50,010

Direct materials = 21,800

Direct labor = 16,400

Overhead = 11,000

Ending Balance = 4,790

Started and completed units cost = $42,050

Therefore,

Cost of completing the units in the beginning WIP inventory:

= Completed and transferred out - Cost of Started and completed units

= $50,010 - $42,050

= $7,960

Answer 2

Answer:

The cost of completing the units in the beginning Work in Process inventory is $7,960

Explanation:

The computation of the beginning Work in Process inventory is shown below:

= Cost of Completed and transferred out  - started and completed units cost

= $50,010 - $42,050

= $7,960

All other information which is mentioned in the question is not relevant. Hence, it is not to be considered in the computation part.  

Since we have to compute the completing units so we considered the above two things only.