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Sur Company uses a weighted-average process-costing system. Company records disclosed that the firm completed 62,600 units...

Sur Company uses a weighted-average process-costing system. Company records disclosed that the firm completed 62,600 units during the month and had 6,000 units in process at month-end, 40% complete. Conversion costs associated with the beginning work-in-process inventory amounted to OMR 279,650, and amounts that relate to the current month totaled OMR800,000. If conversion is incurred uniformly throughout manufacturing, Sur's equivalent-unit cost is:

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Answer :-

Equivalent Unit Cost = ( Conversion cost in beginning work-in-process inventory + Cost related to current month ) / ( Completed Unit + In process unit at month end completed )

Conversion cost in Beginning Work in Process Inventory = OMR 279,650

Cost related to current month = OMR 800,000

Completed unit = 62,600 units

In Process unit at month end completed = 6,000 units × 40% = 2,400 units

Equivalent unit cost = ( OMR 279,650 + OMR 800,000 ) / ( 62,600 units + 2,400 units )

Equivalent unit cost = OMR 1,079,650 / 65,000 units

Sur's Equivalent unit cost = OMR 16.61

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