Question

Pureform, Inc., uses the weighted-average method in its process costing system. It manufactures a product that passes through two departments. Data for a recent month for the first department follow: Units Materials Labor Overhead Work in process inventory, beginning 91,000 $ 92,400 $ 47,900 $ 62,400 Units started in process 869,000 Units transferred out 890,000 Work in process inventory, ending 70,000 Cost added during the month $ 1,222,200 $ 590,350 $ 770,100 The beginning work in process inventory was 90% complete with respect to materials and 75% complete with respect to labor and overhead. The ending work in process inventory was 70% complete with respect to materials and 50% complete with respect to labor and overhead. Required: 1. Compute the first department's equivalent units of production for materials, labor, and overhead for the month. 2. Determine the first department's cost per equivalent unit for materials, labor, and overhead for the month. (Round your answers to 2 decimal places.)

Answer 1

• All working forms part of the answer
• Requirement 1: Equivalent units

EUP - Weighted Average Method	Units	% Material	EUP Materials	% Labor	EUP - Labor	% Overhead	EUP - Overhead
Units TRANSFERRED	890,000	100%	890,000	100%	890,000	100%	890,000
Units of ENDING WIP	70,000	70%	49,000	50%	35,000	50%	35,000
Equivalent Units of Production			939,000 units		925,000		925,000

--Answer

	Material	Labor	Overhead
Equivalent units	939,000	925,000	925,000

• Requirement 2: Cost per Equivalent units

COST per EUP			Material		Labor		Overhead
Cost of Beginning WIP			$        92,400.00		$        47,900.00		$        62,400.00
Cost incurred during the period			$ 1,222,200.00		$    590,350.00		$    770,100.00
Total Costs		Costs	$ 1,314,600.00	Costs	$    638,250.00	Costs	$    832,500.00
Equivalent units of production		EUP	939,000	EUP	925,000	EUP	925,000
Cost per EUP			$            1.40		$              0.69		$              0.90

--Answer

	Material	Labor	Overhead
Cost per Equivalent units	$ 1.40	$ 0.69	$ 0.90