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Kazeer [188]
3 years ago
5

A department using the FIFO method for process costing begins the month with 10,000 units which were 70% complete at the end of

the previous month. They started and completed 50,000 units and their ending work in process inventory consisted of 5,000 units which were 10% complete. The costs incurred were $200,000. The cost per equivalent unit of production, using the FIFO method is $ . Round your answer to two decimal places.
Business
1 answer:
Dahasolnce [82]3 years ago
5 0

Answer:

the cost per equivalent unit of production is $4.60

Explanation:

The concept of Equivalent unit of Production measures the output of a process in terms of percentage completion of inputs added into the units of outputs.

With FIFO method, we are only interested in the costs incurred in the year of production because, the costs of Opening Work in Process will in their entirety go towards the completed units

The first step is to determine the <em>Number of Equivalent units</em> as follows :

To finish Opening Work In Process (10,000 × 30%) =    3,000

Started and Completed ( 50,000 - 10,000) × 100%  = 40,000

Closing Work In process ( 5,000 × 10%)                    =      500

Total Equivalent Units                                                 = 43,500

The Next Step is to Calculate <em>Cost per Equivalent Unit</em>.

Cost per Equivalent Unit = Total Costs / Total Equivalent Units

                                         = $200,000 / 43,500

                                         = $4.60

Therefore, the cost per equivalent unit of production is $4.60

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3 years ago
Nov. 5 Purchased 850 units of product at a cost of $10 per unit. Terms of the sale are 3/10, n/60; the invoice is dated November
pickupchik [31]

Answer: Please see explanation column for answer

Explanation: A perpetual inventory system maintains inventory balances ensuring that records are continually made immediately when purchases or sale are made together with any returns which are recorded in inventory accounts.

To record purchase of merchandise

Date         Account                                    Debit       Credit

Nov 5    Merchandise Inventory         $8500

         Accounts payable                                               $8,500

To record return of merchandise purchased

Nov 7      Accounts payable                  $300

       Merchandise Inventory                                          $300

To record payment of inventory

Nov 15    Accounts payable                $8,200                      

              Cash                                                                  $7,954

          Merchandise Inventory                                         $246

Calculation =

Nov 5 - Cost of merchandise purchased =  No of units x unit price = 850 x 10 =$8500

Nov 7 - Cost of merchandise returned =  No of units returned x unt price = 30 x 10 = $300

discount received = Balance from accounts payable  x discount rate = (8,500- 300) x 3%= 8200 x 0.03=  $246

   Cash  =    Accounts payable    - Merchandise Inventory = $8200 - 246 =$7984.

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A treasury___is issued by the US government, and is considered very safe. The options are:
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South Tel Communications is considering the purchase of a new software management system. The system is called B-lmage, and it i
gavmur [86]

Answer:

Explanation:

South Tel Communications is considering the purchase of a new software management system. The system is called B-image, and it is expected to drastically reduce the amount of time that company technicians spend installing new software. South Tel's technicians currently spend 6,000 hours per year on installation which cost South Tel $25 per hour. The owners of the B-image system claim that their software can reduce time on task by at least 25%. The system requires an initial investment of $55,000 and an additional investment of$10,000 for technician training on the new system. Annual upgrades will cost the firm $15,000 per year. Because the investment is comprised of software, it can be fully expensed in the year of the expenditure (no depreciation). South Tel faces a 30% tax rate and uses a 9% cost of capital to evaluate projects of this type.

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Total (65,000)

Cash flow year 1 - 5

Saving on installations per year 450,000

Less: Annual upgrades ( 15,000)

Total 435,000

Less: Tax (30%) (130,500);

Total project free cash flow 304,500.answer

4 0
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