Question

Nash is a toy maker that produces Flying Flingbats, a soft foam rubber weapon. All direct materials are added at the beginning of production, and conversion costs are incurred evenly throughout production. Conversion was 60% complete for the 8,800 units in WIP on December 1 and 60% complete for the 6,000 units in WIP on December 31. During the month, 11,400 Flingbats were completed and transferred out as finished goods. Following is a summary of the costs for the period: Direct Conversion Materials Costs Work in process, December 1 $ 18,800 $ 6,800 Costs added in December 28,180 19,450 Using the weighted average method, prepare a schedule calculating the total cost per equivalent unit for December. (Round all entries to 2 decimal places, e.g. 15.25.) Direct materials per equivalent unit $ Conversion costs per equivalent unit Total cost per equivalent unit

Answer 1

Answer:

Direct materials per equivalent unit	2.7
Conversion costs per equivalent unit	1.75
Total cost per equivalent unit	4.45
Workings:
	Direct materials	Conversion costs
Units completed and transferred out	11400	11400
Ending WIP
6000 X 100%	6000
6000 X 60%		3600
Equivalent units	17400	15000
	Direct materials	Conversion costs
Work in Process, December 1	18800	6800
Add: Costs added in December	28180	19450
Total costs	46980	26250
Divide by Equivalent units	17400	15000
Cost per Equivalent unit	2.7	1.75