Transferring cost in "weighted-average method"
Hi,
The problem says that the data is prepared by unexperienced accountant. The Beginning WIP is 8000units; materials 100% complete; conversion 7/8 complete... $22,420*
Cost transferred in from the previous department... $81,480
*Consists of cost transferred in, $8,820; materials cost, $3,400; and conversion costs, $10,200.
My book doesn't really explain how to transfer cost from one department to another, so when I'm calculating the "cost per equivalent unit" I need the "Beg WIP" and "Cost added" for materials and for conversion in order to get the "total cost to account for" for both and divide them by the "tot. physical units" for materials and for conversion. How do I carry the cost from the previous department? Should I just get the "($81,480+$8,820)/tot. physical units" and add that to the "cost per equivalent unit" I can calculate if I don't use the transferred cost?
Thanks!
