Walbin Corporation uses the weighted-average method in its process costing system. The beginning work in process inventory in a particular department consisted of 16,500 units, 100% complete with respect to materials cost and 40% complete with respect to conversion costs. The total cost in the beginning work in process inventory was $24,600. A total of 50,000 units were transferred out of the department during the month. The costs per equivalent unit were computed to be $1.30 for materials and $3.00 for conversion costs. The total cost of the units completed and transferred out of the department was:

Total cost of units transferred out =$215,000

Explanation:

The total cost of units transferred out would be determined as follows

Value of units transferred out =

Material cost of units transferred out + Labor cost of units transferred out

Cost for each element= cost per equivalent unit× no of equivalent units

Note that using the weighted average method, the number of equivalent unit for material and labour is taken to be 100% for the unit transferred out.

Material cost =  $1.30 × 50,000 = 65,000

Labour cost  = $3.00× 50,000 = 150,000

Total cost of units transferred out =65,000  + 150,000  = $215,000

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