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Process Costing
Opech, Inc., produces oil and ships it in a pipeline. On May 1, it had no work-in-process inventory. It started production of 300 million barrels of oil in May and shipped 270 million barrels in the pipeline. The costs of the resources used by Opech in May consist of the following:
Materials
$5,000 million
Conversion costs (labor and overhead)
$6,640 million
Required
The production supervisor estimates that the ending work in process is 70 percent complete on May 31. Compute the cost of oil shipped in the pipeline and the amount in work-in-process ending inventory as of May 31.
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