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Weygandt, Accounting Principles, 12e,
Chapter Twenty One
Solutions to Challenge Exercises
Solution
CE 21-1
(a) Units to be accounted for: Physical Units
Applications in process, March 1 250
Applications started in March 1,100
Total Applications 1,350
Units accounted for
Applications completed and transferred out 950
(b) Unit Materials Costs
Applications in process, March 1
Direct materials cost $ 2,125
Costs added to production during March
Unit Conversion Costs
Applications in process, March 1
Conversion costs $ 9,450
Costs added to production during March
Direct labor $ 43,000
Solution
CE 21-1 (cont.)
Part b (cont.) City University
Admissions Department
Cost Reconciliation Schedule
For the Month of March
Costs accounted for:
(c) Equivalent Units
Materials
Applications transferred out 950
Applications in process, March 31
Unit Materials Costs
Applications in process, March 1
Direct materials cost $ 2,125
$8,125 ÷ 1,150 = $7.07
Total savings:
Original materials cost per unit $7.50
New materials cost per unit 7.07
Solution
CE 21-2
(a)
Equivalent Units
Materials Conversion Costs
Beginning work in process 0 0
Units started and completed (9,000 x 100%) 9,000 9,000
(b) Unit Costs
Materials $56,250 ÷ 12,000 = $4.69
Conversion Costs ($123,750 + $45,000) ÷ 11,250 = $15.00
Costs accounted for:
Transferred out (9,000 x $19.69) $177,210
(c) Equivalent Units
Materials Conversion Costs
Beginning work in process
1,000 x 0% 0
1,000 x 60% 600
Solution
CE 21-2 (cont.)
Part c (cont.)
Costs accounted for:
Work in process, November 1st
Materials $ 4,800
Conversion Costs (10,325 – 4,800) + (600 x $14.74) 14,369 $ 19,169
Transferred out (9,000 x $19.43) 174,870
