Manufacturing Cost Accounting & Finance worked example

WIP Valuation at 63% average completion: a worked example

This scenario runs the wip valuation calculation on the strong side: 63% average completion, with every other input held at its documented default. Use it at period close to value work-in-process before it rolls into finished-goods inventory.

The inputs for this scenario

  • Open work orders: 85 orders (unchanged)
  • Accumulated cost per order: 12,000 $ / order (unchanged)
  • Average completion: 63 % (raised for this scenario; the documented default is 55)
  • Unallocated overhead pool: 8,000 $ (unchanged)

Working through the calculation

  • Applying the documented formula (WIP value = open orders x accumulated cost per order x completion% + overhead pool) to the inputs above produces each figure below.
  • At this operating point the engine returns 650,600 $ for total wip valuation cost, the number this scenario is built around.
  • At this operating point the engine returns 7,654 $ / piece for wip valuation cost per unit.
  • At this operating point the engine returns 642,600 $ for variable wip valuation cost.
  • At this operating point the engine returns 8,000 $ for fixed wip valuation adder.

How this compares with the baseline

  • Against the tool's baseline example, where average completion sits at 55% and the headline result is 569,000 $, this scenario comes in 14.34% above the baseline at 650,600 $.
  • Use it at period-end inventory close, for cycle-count reconciliations, or to quantify cash tied up in unfinished production for a lean review. Treat this as a target state: the delta against the baseline quantifies what the improvement is worth before you commit to chasing it.

Results at a glance

  • Total wip valuation cost: 650,600 $ (headline result)
  • Wip valuation cost per unit: 7,654 $ / piece
  • Variable wip valuation cost: 642,600 $
  • Fixed wip valuation adder: 8,000 $

Run it with your numbers

  • Every input above is editable in the live WIP Valuation calculator, which recalculates instantly and can be shared with the inputs intact.

Last reviewed 2026-05-12.