Question

The Blending Department of Luongo Company has the following cost and production data for the month of April. Costs: Work in process, April 1 Direct materials: 100% complete $125,000 Conversion costs: 20% complete 87,500 Cost of work in process, April 1 $212,500 Costs incurred during production in April Direct materials $1,000,000 Conversion costs 456,250 Costs incurred in April $1,456,250 Units transferred out totaled 21,250. Ending work in process was 1,250 units that are 100% complete as to materials and 40% complete as to conversion costs. Compute the equivalent units of production for (1) materials and (2) conversion costs for the month of April. Compute the unit costs for the month. (Round unit costs to 0 decimal places, e.g. 25.) Compute the unit costs for the month. (Round unit costs to 0 decimal Places Determine the costs to be assigned to the units transferred out and in ending work in process. (Round answers to 0 decimal places, e.g. 1,225.)

Answer 1

Equivalent units	Material	Conversion cost
Units transferred                      A	21250	21250
Ending Units	1,250	1,250
Completion	100%	40%
B	1250	500
Total units	22500	21750
Cost per equivalent units
Particulars	Material	Conversion cost	total
As at beginning	125000	87500	212500
Added during the month	1000000	456250	1456250
Cost to be accounted for	1125000	543750	1668750
Total eqivalent units	22500	21750
Cost per equivalent unit	50.00	25.00	75.00
Cost per equivalent unit = Cost to be accounted for / Total equivalent units

Cost of ending work in progress
		Conversion cost
Particulars	Material		Total
Ending units	1,250	1,250
Cost per equivalent units	50.00	25.00
Completion	100%	40%
Total cost	62500	12500	75000
Cost of goods transferred		Conversion cost
Particulars	Material		Total
Number of units	21250	21250
Cost per equivalent units	50.00	25.00	75.00
Total amount	1062500	531250	1593750