The Forming Department is the first of a two-stage production process. Spoilage is identified when the units have completed the Forming process. Costs of spoiled units are assigned to units completed and transferred to the second department in the period spoilage is identified. The following information concerns Forming’s conversion costs in May 2005:
|
Units |
Conversion costs |
|
|
Beginning work in process (50% complete) |
2,000 |
$10,000 |
|
Units started during May |
8,000 |
75,500 |
|
Spoilage—normal |
500 |
|
|
Units completed and transferred |
7,000 |
|
|
Ending work in process (80% complete) |
2,500 |
Using the weighted-average method, what was Forming’s conversion cost transferred to the second production department?
- $59,850
- $64,125
- $67,500
- $71,250