Question

During December, the production department of a process operations system completed and transferred to finished goods a total of 65,000 units of product. At the end of March, 15,000 additional units were in process in the production department and were 80% complete with respect to materials. The beginning inventory included materials cost of $57,500 and the production department incurred direct materials cost of $183,000 during December. Compute the direct materials cost per equivalent unit for the department using the weighted-average method.

a. $3.70.
b. $2.38.
c. $2.82.
d. $3.12.
e. $4.79.

Answer 1

Option D is correct one.

The direct materials cost per equivalent unit for the department using the weighted-average method is $3.12

Step-by-step explanation:

Completed and transferred to finished goods (in units)=65000.00

Equivalent number of additional units in process (in units)=12000.00

Beginning inventory material cost=57500.00

Direct material cost incurred=183000.00

Total direct material cost=240500.00

Direct materials cost per equivalent unit 3.12