Baron Corporation has two sequential processing departments: Assembly and Shaping. The Shaping Department reports the following information. Conversion costs are applied evenly throughout the process. Beginning WIP Inventory 8 comma 000 units Transferredminusin costs in beginning WIP Inventory $ 113 comma 200 Direct materials cost in beginning WIP Inventory $ 29 comma 500 Conversion costs in beginning WIP Inventory $ 23 comma 750 Units transferredminusin 56 comma 000 units Transferredminusin costs $ 546 comma 300 Units completed 47 comma 000 Costs added: direct materials $ 172 comma 120 Costs added: conversion costs $ 245 comma 570 Ending WIP Inventory 17 comma 000 units (40% complete for materials and 30% complete for conversion) The total cost of units in ending WIP InventoryminusShaping would be closest to

Baron Corporation

Total cost of units in ending WIP Inventory would be closest to $300,273.

Explanation:

a) Shaping Department Production Cost Report:

                                                      Units        Cost       Total Cost

Beginning Work in process          8,000

Transferred-in cost in WIP                         $113,200

Direct materials cost in beginning WIP    $ 29,500

Conversion costs in beginning WIP         $ 23,750        $ 166,450

Transferred-in during period    56,000 $ 546,300

Costs added to transferred-in:

Direct materials                                        $ 172,120

Conversion costs                                   $ 245,570       $ 963,990

Total cost                                 64,000                          $ 1,130,440

Transferred-out                       47,000                           $ 830,167

Ending Work in process          17,000                           $ 300,273

b) Unit cost  = $17.66 ($1,130,440/64000)

c) Cost of Transferred-out units = $830,167 {($1,130,440/64,000) x 47,000}

d) Cost of Ending WIP units = $300,273 {($1,130,440/64,000) x 17,000}

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