Task: Allocating costs in a Process Costing System.
Moreno Corporation, a manufacturer of diabetic testing kits, started November production with $75,000 in beginning inventory. During the month, the company incurred $420,000 of materials cost and $240,000 of labor cost. It applied $165,000 of overhead cost to inventory. The company processed 15,000 total equipment units of product.
Q1. Assuming 4,000 equivalent units of product were in ending work in process inventory, determine the amount of cost transferred from the Work in Process Inventory account to the Finished Goods Inventory account. What was the cost of the ending work in process inventory?
Q2. Assuming 12,000 equivalent units were transfered from work in process inventory to finished goods inventory, determine the cost of ending work in process inventory. What was the cost of the finished goods inventory transferred from work in process?