Question

Department G had 1,800 units 25% completed at the beginning of the period, 12,300 units were completed during the period; 1,500 units were 20% completed at the end of the period, and the following manufacturing costs debited to the departmental work in process account during the period:

Work in process, beginning of period	$25,000
Costs added during period:
Direct materials (12,000 units at $8)	96,000
Direct labor	75,000
Factory overhead	25,000

All direct materials are placed in process at the beginning of production and the first-in, first-out method of inventory costing is used. The total cost of the units started and completed during the period is (do not round unit cost calculations)

$153,136

$84,000

$170,420

$187,704

Answer 1

The total cost of the units started and completed during the period is calculated below:

Total Equivalent units are calculated below:

A) Total Equivalent units of Material = (12,300 - 1,800) *100% + 1500 *100

= 10,500 units + 1,500 Units

= 12,000 units

B) Total Equivalent units of Conversion Cost = 1800*75% + (12,300 -1,800) *100% + 1500 *20%

= 1,350 + 10,500 + 300

= 12,150 Units

Cost Per Equivalent units is calculated below:

A)Cost Per Equivalent units of Material :

Cost Per Equivalent units of Material = $96,000 / 12,000 units

= $8

B)Cost Per Equivalent units of Conversion Cost :

Cost Per Equivalent units of Conversion Cost = ($75,000(Direct Labor) + $25,000 (Direct Labor))/ 12,150 Units

= $100,000/12,150

   = $8.2305

The total cost of the units started and completed during the period = 10,500 Units* ($8 + $8.2305)

   = 10,500 Units* $16.2305

= $170,420

So correct answer is option (3) or $170,420