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Outose Concept manufactures small tables in its Processing Department. Direct materials are added at the initiation...

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Accounting

Outose Concept manufactures small tables in its ProcessingDepartment. Direct materials are added at the initiation of theproduction cycle and must be bundled in single kits for each unit.Conversion costs are incurred evenly throughout the productioncycle. Before inspection, some units are spoiled due toundetectable materials defects. Spoiled units generally constitute44% of the good units.

Data for December 2017 are as follows:

WIP, beginning inventory 12/1/2017 22,700 units

????Direct materials (100% complete)

?Conversion costs (75% complete)

Started during December 77,000 units

Completed and transferred out 12/31/2017 72,900 units

WIP, ending inventory 12/31/2017 18,000 units

??Direct materials (100% complete)

???? Conversion costs (70% complete)

Costs for December: ????

WIP, beginning Inventory: ?

???Direct materials $152,000

Conversion costs 77,200

Direct materials added 232,400

? ?Conversion costs added 296,000

What is the total cost per equivalent unit using theweighted?average method of process costing? (Round any cost perunit calculations to the nearest cent.)

Answer & Explanation Solved by verified expert
4.0 Ratings (391 Votes)

Calculation of equivalent units of production for Material cost and conversion cost of Processing department
Physical Units % complete of Material cost Equivalent units of Material cost % complete of Conversion cost Equivalent units of Conversion cost
Units completed and transferred 72900 100% 72900 100% 72900
Units in ending work in process 18000 100% 18000 70% 12600
Equivalent Units of production 90900 85500
Calculation of cost per equivalent unit of production for Material and Conversion cost of Processing department
Material Conversion
Cost of beginning Work in process $152,000.00 $77,200.00
Cost incurred in November $232,400.00 $296,000.00
Total Cost to account for $384,400.00 $373,200.00
/ Equivalent Units of production 90900 85500
Cost per equivalent unit $4.23 $4.36

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