Question

#23

Calculating Cost per Equivalent Unit. The following information pertains to the Finishing department for the month of April.

	Direct Materials	Direct Labor	Overhead
Total costs to be accounted for	$100,000	$200,000	$300,000
Total equivalent units accounted for	10,000 units	8,000 units	8,000 units

Required:

Calculate the cost per equivalent unit for direct materials, direct labor, overhead, and in total. Show your calculations.

Answer 1

Cost per equivalent unit can be obtained by dividing Total costs to be accounted for by Total equivalent units
	Direct Materials	Direct Labor	Overhead	Total
Total costs to be accounted for	100000	200000	300000
Divide by Total equivalent units accounted for	10000	8000	8000
Cost per equivalent unit	10.00	25.00	37.50	72.50