Question

Gunes Corporation uses the weighted-average method in its process costing system. This month, the beginning inventory in the first processing department consisted of 1,400 units. The costs and percentage completion of these units in beginning inventory were:

	Cost				Percent Complete
Materials costs	$	11,200				65%
Conversion costs	$	13,400				30%

A total of 9,100 units were started and 8,000 units were transferred to the second processing department during the month. The following costs were incurred in the first processing department during the month:

	Cost
Materials costs	$	142,700
Conversion costs	$	360,100

The ending inventory was 50% complete with respect to materials and 35% complete with respect to conversion costs.

The cost per equivalent unit for materials for the month in the first processing department is closest to:

Multiple Choice:

• $14.63

• $13.49

• $15.23

• $16.64

Answer 1

Correct answer-----------$16.64

Working

Reconciliation of Units
A	Beginning WIP	1,400
B	Introduced	9,100
C=A+B	TOTAL	10,500
D	Transferred out	8,000
E=C-D	Ending WIP	2,500

.

Statement of Equivalent Units(Weighted average)
				Material
	Units			Complete %	Equivalent units
Transferred out	8,000			100%	8,000
Ending WIP	2,500			50%	1,250
Total	10,500			Total	9,250

.

Cost per Equivalent Units (Weighted average)
COST		Material
Beginning WIP Inventory Cost		$ 11,200
Cost incurred during period		$ 142,700
Total Cost to be accounted for		$ 153,900
Total Equivalent Units		9,250
Cost per Equivalent Units		$                 16.64