Inacio Corporation uses the weighted-average method in its process costing syste

Question

Inacio Corporation uses the weighted-average method in its process costing system. Data concerming the first processing department for the most recent month are listed below Beginning work in process inventory: 2,400 $ 14,500 Units in beginning work in process inventory Materials costs Conversion costs Percent complete with respect to materials Percent complete with respect to conversion $6,600 75 005107 20 % Units started into production during the month 11,100 Units tranaferred to the next department during the month10,000 $173,600 $243, 600 Materials costs added during the month Conversion costs added during the month Ending work in process inventory Units in ending work in process inventory Percent complete with respect to materials Percent complete with respect to conversion 3,500 901 308 The cost per equivalent unit for materials for the month in the first processing department is closest to Mutiple Choice

Explanation / Answer

Using weighted average method, Equivalent units = Units that are completed during the period + Equivalent units in process at the end of period.

Equivalent units = 10,000 + (3,500*90%)

= 13,150

Cost per equivalnet unit for materials = (beginning costs + current costs) / Equivalent units

= ($14,500 + $173,600) / 13,150

= $14.304

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