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            60,000 $          67,300 $    11,400       $21,000

Units started in process                                   569,000

Units transferred out                                        590,000

Work in process inventory, ending                    39,000

Cost added during the month                                                  $889,515 $ 140,975 $ 259,370.

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.

                                                         Materials                      Labor                 Overhead

Equalvent units of production

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

Cost per equalvent unit

Answer 1

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

	Physical unit	%	material	%	Labour	%	Overhead
Unit transferred out	590000	100%	590000	100%	590000	100%	590000
Ending work in process	39000	70%	27300	50%	19500	50%	19500
Total Equivalent unit			617300		609500		609500

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.)

	Material	Labour	Overhead
Beginning work in process	67300	11400	21000
Cost added during period	889515	140975	259370
Total cost	956815	152375	280370
Equivalent unit	617300	609500	609500
Cost per equivalent unit	1.55	0.25	0.46