Question

Dodd Corporation uses the weighted-average method in its process costing system. This month, the beginning inventory in the first processing department consisted of 670 units. The costs and percentage completion of these units in beginning inventory were: Cost Percent Complete Materials costs $7,600 70% Conversion costs $6,600 15% A total of 9,800 units were started and 8,350 units were transferred to the second processing department during the month. The following costs were incurred in the first processing department during the month: Materials costs $137,600 Conversion costs $323,600 The ending inventory was 85% complete with respect to materials and 70% complete with respect to conversion costs. Note: Your answers may differ from those offered below due to rounding error. In all cases, select the answer that is the closest to the answer you computed. To reduce rounding error, carry out all computations to at least three decimal places. The cost per equivalent unit for materials for the month in the first processing department is closest to: $13.55 $13.14 $13.87 $14.30

Answer 1

1. Computation of cost per Equivalent Units for materails

Opening balance	670.00	$      7,600.00
Started in the Month	9,800.00	$ 1,37,600.00
Total in First Processing Department	10,470.00	$ 1,45,200.00

As thec Company follow weighted cost concept

cost per equivalent Unit for materials = Total Cost / Total Units in Processing

cost per equivalent Unit for materials = $145200 / 10470 = $13.87