Question

At the beginning of the month, the Painting Department of Skye Manufacturing had 20,000 units in inventory, 70% complete as to materials, and 20% complete as to conversion. The cost of the beginning inventory, $28,650, consisted of $22,400 of material costs and $6,250 of conversion costs. During the month the department started 115,000 units and transferred 120,000 units to the next manufacturing department. Costs added in the current month consisted of $229,600 of materials costs and $540,500 of conversion costs. At the end of the month, the department had 15,000 units in inventory, 40% complete as to materials and 10% complete as to conversion. If Skye Manufacturing uses the weighted average method of process costing, compute the costs per equivalent unit of materials and conversion respectively for the Painting Department.

Answer 1

Cost per EUP Materials: $2,00

Cost per EUP Conversion: $4,50

Step-by-step explanation:

Materials Conversion

Beginning WIP Cost $22,400 $6,250

Cost added in the period $229,600 $540,500

Total Cost of the Units $252,000 $546,750

Equivalent Units of Production (EUP): Completed Units + Ending WIP Units

EUP Materials = 120,000 + 15,000 x 40% = 126,000

EUP Conversion = 120,000 + 15,000 x 10% = 121,500

Cost per Equivalent Unit: Cost of Units / EUP

Cost per EUP Materials: $252,000 / 126,000 = $2,00

Cost per EUP Conversion: $546,750 / 121,500 = $4,50