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Cornerstone Exercise 6.6 (Algorithmic) Nonuniform Inputs Apeto Company produces premium chocolate candy bars. Conversion costs are...

Cornerstone Exercise 6.6 (Algorithmic) Nonuniform Inputs Apeto Company produces premium chocolate candy bars. Conversion costs are added uniformly. For February, EWIP is 30 percent complete with respect to conversion costs. Materials are added at the beginning of the process. The following information is provided for February: Physical flow schedule: Units to account for: Units in BWIP 0 Units started 70,000 Total units to account for 70,000 Units to account for: Units completed: From BWIP 0 Started and completed 48,000 48,000 Units in EWIP 22,000 Total units accounted for 70,000 Inputs Direct Materials Conversion Costs $31,500 $54,600 Required: 1. Calculate the equivalent units for each input category. Equivalent Units Direct Materials Conversion 2. Calculate the unit cost for each category and in total. If required, round your answers to the nearest cent. Unit direct materials cost $ Unit conversion cost $ Total unit cost $ 3. What if a different type of materials is also added at the end of the process (a candy wrapper), costing $4,800? Calculate the new unit cost. If required, round your answer to the nearest cent. $ per unit

Solutions

Expert Solution

Beggining units 0 Transferred out 48,000
Started intro production 70000 Ending units 22,000
Units accounted for 70000 70000
Equivalent units Material Conversion cost
Units transferred                      A 48000 48000
Ending Units 22,000 22,000
Completion 100% 30%
B 22000 6600
Total units 70000 54600
Cost per equivalent units
Particulars Material Conversion cost total
As at beginning 0 0 0
Added during the month 31500 54600 86100
Cost to be accounted for 31500 54600 86100
Total eqivalent units 70000 54600
Cost per equivalent unit 0.45 1.00 1.45
Cost per equivalent unit = Cost to be accounted for / Total equivalent units

3.

Cost per equivalent units
Particulars Material Conversion cost total
As at beginning 0 0 0
Added during the month 36300 54600 90900
Cost to be accounted for 36300 54600 90900
Total eqivalent units 70000 54600
Cost per equivalent unit 0.52 1.00 1.52
Cost per equivalent unit = Cost to be accounted for / Total equivalent units

ekkarill92 answered 1 year ago
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