Question

Talamoto Co. manufactures a single product that goes through two processes – mixing and cooking. The following data pertains to the Mixing Department for September. 33,000 units 70% 22,000 units 50% 100,000 ? units Work-in-process Inventory Sept. 1 Conversion complete Work-in-process inventory Sept. 30 Conversion complete Units started into production in Sept. Units completed and transferred out Costs Work-in-process inventory Sept.1 Material P Material o Conversion Costs added in September Material P Materiale Conversion $167,000 153,000 167,000 $251,000 230,000 494,200 Material P is added at the beginning of work in the Mixing Department. Material Q is also added in the Mixing Department, but not until units of product are forty percent completed with regard to conversion. Conversion costs are incurred uniformly during the process. Cost per equivalent unit for conversion under the weighted-average method is calculated to be:

Answer 1

Unit transferred out = 33000+100000-22000 = 111000

Equivalent unit of Conversion = 111000+(22000*50%) = 122000

Total Cost of conversion = 167000+494200 = 661200

Cost per equivalent unit of conversion = 661200/122000 = 5.42

So answer is e) $5.42