In: Accounting
Georgia Products Inc. completed and transferred 190,000 particleboard units of production from the Pressing Department. There was no beginning inventory in process in the department. The ending in-process inventory was 16,000 units, which were 3/5 complete as to conversion cost. All materials are added at the beginning of the process. Direct materials cost incurred was $566,500, the direct labor cost incurred was $258,680, and factory overhead applied was $60,680.
Determine the following for the Pressing Department. Round "cost per equivalent unit" answers to the nearest cent.
A. Total conversion cost
B. Conversion cost per equivalent unit
C. Direct materials cost per equivalent unit
Solution
A. Total conversion cost= 319,360
B. Conversion cost per equivalent unit= $1.60 perunit
C. Direct materials cost per equivalent unit = $2.75 per unit
Working
Statement of Equivalent Units(Weighted average) | |||||||
Material | Conversion | ||||||
Units | Complete % | Equivalent units | Complete % | Equivalent units | |||
Transferred out | 190,000 | 100% | 190,000 | 100% | 190,000 | ||
Ending WIP | 16,000 | 100% | 16,000 | 60% | 9,600 | ||
Total | 206,000 | Total | 206,000 | Total | 199,600 |
.
Cost per Equivalent Units (Weighted average) | ||||
COST | Material | Conversion | TOTAL | |
Beginning WIP Inventory Cost (A) | $ 0 | |||
Cost incurred during period (B) | $ 566,500 | $ 319,360 | $ 885,860 | |
Total Cost to be accounted for (C=A+B) | $ 566,500 | $ 319,360 | $ 885,860 | |
Total Equivalent Units(D) | 206,000 | 199,600 | ||
Cost per Equivalent Units (E=C/D) | $ 2.75 | $ 1.60 | $ 4.35 |