Cost per Equivalent Unit The following information concerns production in the Fo
ID: 2332151 • Letter: C
Question
Cost per Equivalent Unit The following information concerns production in the Forging Department for September. All direct materials are placed into the process at the beginning of production, and conversion costs are incurred evenly throughout the process. The beginning inventory consists of $75,350 of direct materials. ACCOUNT Work in Process—Forging Department ACCOUNT NO. Date Item Debit Credit Balance Debit Credit Sept. 1 Bal., 5,500 units, 50% completed 80,850 30 Direct materials, 50,000 units 675,000 755,850 30 Direct labor 46,140 801,990 30 Factory overhead 63,711 ? 865,701 30 Goods finished, ? units ? 30 Bal., 4,400 units, 90% completed ?
a. Determine the number of units transferred to the next department. units
b. Determine the costs per equivalent unit of direct materials and conversion. If required, round your answer to two decimal places. Cost per equivalent unit of direct materials $ Cost per equivalent unit of conversion $
c. Determine the cost of units started and completed in September. $
Explanation / Answer
a Number of units transferred to the next department = 5500+50000-4400= 51100 units b Equivalent unit of direct materials = 50000 Equivalent unit of conversion costs = (5500*50%)+(51100-5500)+(4400*90%)= 52310 Costs per equivalent unit: Direct materials 13.5 =675000/50000 Conversion 2.10 =(46140+63711)/52310 c Cost of units started and completed in September = (51100-5500)*(13.5+2.1)= $711360