Question

Skye Manufacturing's Painting Department, using the weighted average method of process costing, had 38,000 units in inventory at the beginning of the month, 80% complete as to materials, and 20% complete as to conversion. At the end of the month, they had 24,000 units in inventory, 30% complete as to materials and 15% complete as to conversion. During the month, 133,000 units were started and 147,000 units were transferred to the next department. Costs added in the current month included $315,340 of materials costs and $579,590 of conversion costs.

What are the costs per equivalent unit of materials and conversion, respectively, for the Painting Department?

a) Materials: $1.85, Conversion: $3.92
b) Materials: $2.30, Conversion: $4.15
c) Materials: $2.20, Conversion: $3.95
d) Materials: $1.95, Conversion: $4.05

Answer 1

The costs per equivalent unit of materials and conversion for the Painting Department using the weighted average method can be calculated as $1.77 and $21.56, respectively.

Step-by-step explanation:

The costs per equivalent unit of materials and conversion, respectively, for the Painting Department can be calculated using the weighted average method.

First, we need to calculate the equivalent units of production for materials and conversion:

Equivalent units of materials = (Units started + Units in ending inventory) * Percentage complete as to materials

Equivalent units of conversion = (Units started + Units in ending inventory) * Percentage complete as to conversion

Using the given information, we have:

Equivalent units of materials = (133,000 + 24,000) * 30% = 177,900

Equivalent units of conversion = (133,000 + 24,000) * 15% = 26,850

Next, we can calculate the costs per equivalent unit:

Cost per equivalent unit of materials = Total materials costs / Equivalent units of materials = $315,340 / 177,900 = $1.77 (rounded to the nearest cent)

Cost per equivalent unit of conversion = Total conversion costs / Equivalent units of conversion = $579,590 / 26,850 = $21.56 (rounded to the nearest cent)

Therefore, the costs per equivalent unit of materials and conversion, respectively, for the Painting Department are $1.77 and $21.56.