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	63,000	$	54,400	$	22,100	$	26,900
Units started in process	599,000
Units transferred out	620,000
Work in process inventory, ending	42,000
Cost added during the month		$	802,980	$	360,030	$	420,035

The beginning work in process inventory was 80% complete with respect to materials and 65% complete with respect to labor and overhead. The ending work in process inventory was 60% complete with respect to materials and 50% complete with respect to labor and overhead.

Required:

Assume that the company uses the FIFO method in its process costing system.

1. Compute the first department's equivalent units of production for materials, labor, and overhead for the month.

2. Compute the first department's cost per equivalent unit for materials, labor, overhead, and in total for the month. (Round your answers to 2 decimal places.)

Answer 1

Pureform, Inc.
company uses the FIFO method
1. Compute the first department's equivalent units of production for materials, labor, and overhead for the month.
	Units	Material		Labor & Overhead
		%	Units	%	Units
Work in process - Beginning	63000	20%	12600	35%	22050
Units started
Completed and transferred out	557000	100%	557000	100%	557000
Work in process - Ending	42000	60%	25200	50%	21000
Equivalent Units of production	662000		594800		600050
2. Compute the first department's cost per equivalent unit for materials, labor, overhead, and in total for the month. (Round your answers to 2 decimal places.)
	Material	Labor & Overhead	Total
Cost added during the month	$8,02,980	$7,80,065	$15,83,045
Equivalent Units of production	594800	600050
Cost per equivalent unit	$1.35	$1.30	$2.65
Pureform, Inc.
company uses the weighted-average method
1. Compute the first department's equivalent units of production for materials, labor, and overhead for the month.
Units to be accounted for
Work in process - Beginning	63000
Units started in process	599000
Total units to be accounted	662000
Units accounted for	Units	Material		Labor & Overhead
		%	Units	%	Units
Units completed and transferred out	620000	100%	620000	100%	620000
Work in process - Ending	42000	60%	25200	50%	21000
Equivalent Units of production	662000		645200		641000
2. Compute the first department's cost per equivalent unit for materials, labor, overhead, and in total for the month. (Round your answers to 2 decimal places.)
Cost to be accounted for	Material	Labor & Overhead	Total
Cost of work in beginning	$54,400	$49,000	$1,03,400
Cost added during the month	$8,02,980	$7,80,065	$15,83,045
Total cost to be accounted for	$8,57,380	$8,29,065	$16,86,445
Equivalent Units of production	645200	641000
Cost per equivalent unit	$1.33	$1.29	$2.62