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 | 86,000 | $ | 70,200 | $ | 39,600 | $ | 53,000 |
Units started in process | 814,000 | ||||||
Units transferred out | 820,000 | ||||||
Work in process inventory, ending | 80,000 | ||||||
Cost added during the month | $ | 928,000 | $ | 488,640 | $ | 654,160 | |
The beginning work in process inventory was 80% complete with respect to materials and 65% complete with respect to labor and overhead. The ending work in process inventory was 60% complete with respect to materials and 40% 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.)
1. Compute the first department's equivalent units of production for materials, labor, and overhead for the month.
Material | Labour | Overhead | |
Unit transferred out | 820000 | 820000 | 820000 |
Ending work in process | 80000*60% = 48000 | 80000*40% = 32000 | 80000*40% = 32000 |
Equivalent unit of production | 868000 | 852000 | 852000 |
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 | 70200 | 39600 | 53000 |
Cost added | 928000 | 488640 | 654160 |
Total Cost | 998200 | 528240 | 707160 |
Equivalent unit | 868000 | 852000 | 852000 |
Cost per equivalent unit | 1.15 | 0.62 | 0.83 |
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