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	71,000	$	61,700	$	26,800	$	38,100
Units started in the process	679,000
Units transferred out	700,000
Work in process inventory, ending	50,000
Cost added during the month		$	815,550	$	330,700	$	469,550

The beginning work in process inventory was 70% complete with respect to materials and 55% complete with respect to labor and overhead. The ending work in process inventory was 50% complete with respect to materials and 30% 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) Equivalent unit of production

	Material	Labor	Overhead
Unit transferred out	700000	700000	700000
Ending WIP	50000*50% = 25000	50000*30% = 15000	15000
Equivalent unit	725000	715000	715000

2) Cost per equivalent unit

	Material	Labor	Overhead
Beginning WIP	61700	26800	38100
Cost added	815550	330700	469550
Total Cost	877250	357500	507650
Equivalent unit	725000	715000	715000
Cost per equivalent unit	1.21	0.50	0.71