Problem

Badgersize Company has the following information for its Forming Department for the month...

Badgersize Company has the following information for its Forming Department for the month of August:

Work in Process Inventory, August 1: 20,000 units

 

Direct materials: 100% complete

$ 80,000

Conversion: 20% complete

24 000

Balance in work in process, August 1

$104,000

Units started during August

50,000

Units completed and transferred in August

60,000

Work in process (70% complete), August 31

?

Costs charged to Work in Process in August

 

Direct materials

$150,000

Conversion costs:

 

Direct labor

$120,000

Overhead applied

132,000

Total conversion

$252,000

Assume materials are added at the start of processing.

Instructions

a.    Calculate the equivalent units for the Forming Department for the month of August.


b.    Find the cost per equivalent unit of the transferred units.

Step-by-Step Solution

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