Question

For the month of July, Jacobs Company incurs a direct materials cost of $6,000 for 6,000 gallons of paint produced in its Mixing Department. It also incurs conversion costs of $1,470 with 70% completed. If the conversion cost per equivalent unit was $0.25 per gallon in June, what is the difference in the conversion cost per equivalent unit between th

Answer 1

Answer:

The difference in the conversion cost per equivalent unit between the month of June and July is $0.10 .

Explanation:

Hie your question has a missing part. I have searched for the missing information and the full question reads :

For the month of July, Jacobs Company incurs a direct materials cost of $6,000 for 6,000 gallons of paint produced in its Mixing Department. It also incurs conversion costs of $1,470 with 70% completed. If the conversion cost per equivalent unit was $0.25 per gallon in June, what is the difference in the conversion cost per equivalent unit between the month of June and July.

Solution :

First Calculate the Total Equivalent Units of Production for Conversion Cost for July

Total Equivalent Units = 6,000 × 70%

                                     = 4,200

Then Calculate the Cost per Equivalent Unit for July

Cost per Equivalent Unit = Total Cost / Total Equivalent Units

                                         = $1,470 / 4,200

                                         = $0.35

Difference = $0.35 - $0.25

               = $0.10