Question

Method L04-2, L04-3 4. Compute the first pl department for materials, conversioll, ano manufactures ocess costing system. It manufa for the first department EXERCISE 4-9 Equivalent Units and Cost per Equivalent Unit-weighted average Method Pureform, Inc., uses the weighted average method i a product that passes through two departments. Data for a recent month for the fir follow: Labor Overhe Materials $4,320 $1,040 $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 759 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 over head for the month. 2. Determine the first department's cost per equivalent unit for materials, labor, and overhead for the month. EXERCISE 4-10 Equivalent Units of Production Alarla

Answer 1

Solution 1:

Computation of Equivalent units of production (EUP)
	Physical Units	%Material	EUP-Material	% Labor	EUP- Labor	% Overhead	EUP- Overhead
Units Transferred out	42000	100%	42000	100%	42000	100%	42000
Work in process Inventory, Ending	8000	75%	6000	50%	4000	50%	4000
Total Equivalent units			48000		46000		46000

Solution 2:

Computation of Cost Per unit
	Material	Labor	Overhead
Cost of Beginning Work in process	$4,320	$1,040	$1,790
Costs added during the month	$52,800	$21,500	$32,250
Total Costs	$57,120	$22,540	$34,040
/Equivalent units of Production	48000	46000	46000
Cost per Equivalent unit of Production	$1.19	$0.49	$0.74