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 73,000 $ 57,100 $ 27,700 $ 39,000 Units started in process 689,000 Units transferred out 710,000 Work in process inventory, ending 52,000 Cost added during the month $ 755,360 $ 341,030 $ 481,560 The beginning work in process inventory was 75% complete with respect to materials and 60% complete with respect to labor and overhead. The ending work in process inventory was 55% complete with respect to materials and 25% 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. 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.)

Answer 1

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

	Physical unit	%	EUP-material	%	EUP-labour	%	EUP-overhead
Units transferred out	710000	100%	710000	100%	710000	100%	710000
Ending work in process	52000	55%	28600	25%	13000	25%	13000
Total	762000		738600		723000		723000

2. Determine the first department's cost per equivalent unit for materials, labor, and overhead for the month.

	material	Labour	Overhead
Beginning work in process	57100	27700	39000
Cost added during period	755360	341030	481560
Total cost	812460	368730	520560
Equivalent unit	738600	723000	723000
Cost per equivalent unit	1.10	0.51	0.72