Question

The Matsui Lubricants plant uses the weighted-average method to account for its work-in-process inventories. The accounting records show the following information for a particular day:

Beginning WIP inventory
Direct materials	$	985
Conversion costs		572
Current period costs
Direct materials		28,660
Conversion costs		17,809

Quantity information is obtained from the manufacturing records and includes the following:

Beginning inventory	850	units	(70% complete as to materials, 54% complete as to conversion)
Current period units started	6,000	units
Ending inventory	1,600	units	(50% complete as to materials, 20% complete as to conversion)

4.

value:
10.00 points

Required information

Required:

(1) Compute the equivalent units for the materials and conversion cost calculations.

(2) Compute the cost per equivalent unit for direct materials and conversion costs. (Round your answers to 2 decimal places.)

Answer 1

1) Compute the equivalent units for the materials and conversion cost calculations.

	Physical unit	%	EUP-material	%	EUP-conversion
Units transferred out	5250	100%	5250	100%	5250
Ending work in process	1600	50%	800	20%	320
Total	6850		6050		5570

2) Compute the cost per equivalent unit for direct materials and conversion costs.

	Material	Conversion
Beginning work in process	985	572
Cost added during period	28660	17809
Total cost	29645	18381
Equivalent unit	6050	5570
Cost per equivalent unit	4.90	3.30