Question

The following information applies to the questions displayed below During April, the production department of a process manufacturing system completed a number of units of a product and transferred them to finished goods. Of these transferred units, 81,000 were in process in the production department at the beginning of April and 324,000 were started and completed in April. April's beginning inventory units were 65% complete with respect to materials and 35% complete with respect to conversion. At the end of April, 103,000 additional units were in process in the production department and were 80% complete with respect to materials and 30% complete with respect to conversion. The production department had $1,434,675 of direct materials and $1,002,573 of conversion costs charged to it during April. Also, its beginning inventory of $287,867 consists of $222,485 of direct materials cost and $65,382 of conversion costs. Using the FIFO method, prepare the direct materials cost and the conversion cost per equivalent unit and assign April's costs to the department's output. (Round "Cost per EUP" to 2 decimal places.

Answer 1

Total units transferred out: 2,375,864.5

Materials Cost per equivalent unit: 3.3

Conversion Cost per equivalent unit: 2.45

Step-by-step explanation:

Equivalent units = started and completed + incomplete beginning + complete ending

beginning WIP 81,000 x (1 - 65%) = 28,350

started and completed 324,000

ending WIP 103000 x 0.8 = 82,400

Total equivalent units (materials): 434,750

Materials Cost per equivalent unit: 1,434,670 / 434,750 = 3.3

beginning WIP 81,000 x (1 - 35%) = 53,650

started and completed 324,000

ending WIP 103000 x 0.3 = 30,900

Total equivalent units (conversion): 408,550

Conversion Cost per equivalent unit: 1,002,573 / 408,550 = 2.45

Cost of units transferred out:

beginning inventory: 28,350 x 3.3 + 53,650 x 2.45 + 287,867 = 512,864.5

started and complete: 324,0000 x (3.3 + 2.45) = 1,863,000

Total units transferred out: 2,375,864.5