Question

n October, Pedraza Corp.’s production was 53,600 equivalent units for direct material, 48,800 equivalent units for...

n October, Pedraza Corp.’s production was 53,600 equivalent units for direct material, 48,800 equivalent units for direct labor, and 42,000 equivalent units for overhead. During October, direct material, conversion, and overhead costs incurred were as follows:

Direct material $158,688
Conversion 189,648
Overhead 85,200

Beginning WIP Inventory costs for October were $26,232 for direct material, $19,504 for direct labor, and $20,640 for overhead.

a. How much did Pedraza Corp. spend on direct labor in October? $Answer
b. What was the October weighted average cost per equivalent unit for direct material, direct labor, and overhead?
Note: Round your answers to two decimal places.

DM cost per EU $
DL cost per EU $
OH cost per EU $

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Answer #1

Ans:

1. Pedraza Corp. spend on direct labor in October = Conversion Cost- Overhead Cost

=> 189,648-85,200

=> $104,448

2. weighted average cost per equivalent unit for direct material, direct labor and Overhead

Cost per EUP{ for Direct Materials}= Beginning Work in progress Inventory+ Current Direct Material Cost/Equivalent unit Production Cost of Direct materials

=> {26,232+158,688}/53,600

=> {184,920/53,600

=> $3.45

Cost per EUP{ for Direct Labor}= beginning Work in Progress Inventory+ Current Direct labor Cost/Equivalent unit production Cost of Direct labor

=> {19,504+104,448}/48,800

=> 123,952/48,800

=> $2.54

Cost per EUP{ for Overhead}= Beginning Work in process Inventory+ Current Direct overhead Cost/Equivalent unit production cost of overhead cost

=> {20,640+85,200}/42,000

=> 105,840/42,000

=> $2.52

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