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	97,000	$	101,200	$	54,300	$	69,600
Units started in process	918,000
Units transferred out	940,000
Work in process inventory, ending	75,000
Cost added during the month		$	1,337,925	$	669,050	$	859,025

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.)

	Materials Labor Overhead 1. Equivalent units of production 2. Cost per equivalent unit

Answer 1

		Materials	Labor	Overhead
1)	Equivalent units of production	9,92,500	9,77,500	9,77,500
	Working:
			Materials		Labor		Overhead
		Physical Units	% of completion	Equivalent units of production	% of completion	Equivalent units of production	% of completion	Equivalent units of production
	Units Transferred out	9,40,000	100%	9,40,000	100%	9,40,000	100%	9,40,000
	Work in process inventory, ending	75,000	70%	52,500	50%	37,500	50%	37,500
	Total	10,15,000		9,92,500		9,77,500		9,77,500
2)
		Materials	Labor	Overhead
	Cost per Equivalent unit	$                   1.45	$                    0.74	$                 0.95
	Working:	Materials	Labor	Overhead
	Work in process inventory	$           1,01,200	$                54,300	$            69,600
	Costs incurred duuring this period	$         13,37,925	$            6,69,050	$        8,59,025
	Total Costs	$         14,39,125	$            7,23,350	$        9,28,625
	/ Equivalent units of production	9,92,500	9,77,500	9,77,500
	Cost per equivalent unit	$                   1.45	$                    0.74	$                 0.95