Question

During December, the production department of a process operations system completed and transferred to finished goods a total of 66,000 units of product. At the end of December, 12,000 additional units were in process in the production department and were 50% complete with respect to materials. The beginning inventory included materials cost of $60,800 and the production department incurred direct materials cost of $192,900 during December. Compute the direct materials cost per equivalent unit for the department using the weighted-average method.

Answer 1

Direct materials cost per equivalent unit is $3.25

Step-by-step explanation:

The computation of the direct material cost per equivalent cost is shown below:

Completed and transferred to finished goods 66,000 units

Equivalent number of additional units in process 12000 units

Beginning inventory material cost $60,800

Direct material cost incurred $192,900

Total direct material cost $253,700

ANd, the total units is 78,000

So,

Direct materials cost per equivalent unit is $3.25