Question

Gunes Corporation uses the weighted-average method in its process costing system. This month, the beginning inventory in the first processing department consisted of 1,500 units. The costs and percentage completion of these units in beginning inventory were:

	Cost				Percent Complete
Materials costs	$	11,300				65%
Conversion costs	$	13,500				30%

A total of 9,200 units were started and 8,100 units were transferred to the second processing department during the month. The following costs were incurred in the first processing department during the month:

	Cost
Materials costs	$	142,800
Conversion costs	$	360,200

The ending inventory was 50% complete with respect to materials and 35% complete with respect to conversion costs.

The cost per equivalent unit for materials for the month in the first processing department is closest to:

Answer 1

	Material
Cost per equivalent Unit	$   16.39

Answer is given with 2 decimal places. Although in the working below I have posted answer with 4 decimal places. Please make necessary adjustments depending upon choices of answer given.

Leave a comment in case of any query.

Working note

		Units
Reconciliation of Units
A	Opening WIP	1,500
B	Introduced	9,200
C=A+B	TOTAL	10,700
D	Transferred	8,100
E=C-D	Closing WIP	2,600

Statement of Equivalent Units
		Material		Conversion Cost
	Units	Complete %	Equivalent units	Complete %	Equivalent units
Transferred	8,100	100%	8,100	100%	8,100
Closing WIP	2,600	50%	1,300	35%	910
Total	10,700	Total	9,400	Total	9,010

Cost per Equivalent Units
COST	Material
Beginning WIP Inventory Cost	$             11,300
Cost incurred during period	$           142,800
Total Cost to be accounted for	$           154,100
Total Equivalent Units	9,400
Cost per Equivalent Units	$           16.3936