Question

Use this information about Carmelita Inc. to answer the question that follow Carmelita Inc. has the following information available: Costs from Beginning Inventory Costs from Current Period Direct materials $5,300 $20,300 Conversion costs 5.000 159,700 At the beginning of the period, there were 600 units in process that were 43% complete as to conversion costs and 100% complete as to direct materials costs. During the period, 4.800 units were started and completed. Ending inventory contained 400 units that were 22% complete as to conversion costs and 100% complete as to materials costs. The company uses the FIFO process cost method The cost of completing a unit (rounded to the nearest cent) during the current period was a $51.66 b. $30.54 c. $41.39 d. $34.44

Answer 1

Answer: d. $34.44

		Equivalent Units
	Physical Units	Direct Materials	Conversion Costs
Units completed during current period:
From beginning work in process inventory (600 x 57%)	600	0	342
Units started and completed during current period	4800	4800	4800
Total units completed during current period	5400	4800	5142
Units in ending work in process inventory (400 x 22%)	400	400	88
Total units accounted for	5800
Equivalent units		5200	5230
	Direct Materials	Conversion Costs	Total
Costs incurred in current period	$                20,300	$ 159,700
Divide by equivalent units	5200	5230
Cost per equivalent unit $	$                     3.90	$                     30.54	$                     34.44