Question

Pureform, Inc., uses the weighted average method in its process costing system. It manufactures a product that passes through two departments. Data for a recent month for the first department follow: Materials $ 4,320 Labor 1,040 Overhead $ 1,790 $ Work in process inventory, beginning Units started in process Units transferred out Work in process inventory, ending Cost added during the month Units 5,000 45,000 42,000 8,000 $ 52,800 $ 21,500 $ 32,250 The beginning work in process inventory was 80% complete with respect to materials and 60% complete with respect to labor and overhead. The ending work in process inventory was 75% complete with respect to materials and 50% complete with respect to labor and overhead. Required: 1. Compute the first department's equivalent units of production for materials, labor, and overhead for the month. 2. Determine the first department's cost per equivalent unit for materials, labor, and overhead for the month. (Round your answers to 2 decimal places.)

Answer 1

Solution

	Material	Labor	Overhead
Equivalent units	48,000	46,000	46,000

.

	Material	Labor	Overhead
Cost per Equivalent units	$                    1.19	$                   0.49	$                  0.74

Working

Statement of Equivalent Units(Weighted average)
		Material		Labor		Overhead
	Units			Complete %	Equivalent units	Complete %	Equivalent units
Transferred	42,000	100%	42,000.0	100%	42,000.0	100%	42,000
Closing WIP	8,000	75%	6,000.0	50%	4,000.0	50%	4,000
Total	50,000		48,000	Total	46,000.0	Total	46,000

.

	Material	Labor	Overhead
Work in process beginning (A)	$           4,320.00	$          1,040.00	$         1,790.00
Cost added during may (B)	$         52,800.00	$        21,500.00	$       32,250.00
Total Cost (C=A+B)	$         57,120.00	$        22,540.00	$       34,040.00
Equivalent units of production (D)	48,000	46,000.0	46,000
Cost per Equivalent unit (C/D)	$                    1.19	$                   0.49	$                  0.74