Diston Company uses the weighted-average method in its process costing system. T
ID: 2487179 • Letter: D
Question
Diston Company uses the weighted-average method in its process costing system. The first processing department, the Welding Department, started the month with 20.000 units in its beginning work in process inventory that were 25% complete with respect to conversion costs The conversion cost in this beginning work in process inventory was $44,980 An additional 91.000 units were started into production during the month and 95.000 units were completed in the Welding Department and transferred to the next processing department There were 16.000 units in the ending work in process inventory of the Welding Department that were 15% complete with respect to conversion costs A total of $679,700 in conversion costs were incurred in the department dunng the month The cost per equivalent unit for conversion costs for the month is closest to:Explanation / Answer
Cost per Equivalent unit is $7.44. Particulars Conversion %completion Equivalent Conv Opening WIP 20,000.00 100% 20,000.00 Units started and completed(95,000 -20,000) 75,000.00 100% 75,000.00 Closing WIP = 91,000 -75,000 16,000.00 15% 2,400.00 Equivalent Units 97,400.00 Opening WIP Costs 44,980.00 Current Month Costs 679,700.00 Total Costs 724,680.00 Cost per Equivalent units 7.44