Answer:
Cost per equivalent unit of material = $2.20 per unit
Cost per equivalent unit of conversion = $4 unit
Explanation:
The computation of Cost per equivalent unit of material, Cost per equivalent unit of conversion is shown below:-
For computing the cost per equivalent first we need to find the equivalent unit of material which is below:-
= Transferred units + (
Department units × Material percentage)
= 135,000 + (20,000 × 40%)
= 135,000 + 8,000
= 143,000
So, the Cost per equivalent unit of material = (Beginning material cost + Current month material cost) ÷ Equivalent unit of material
= ($32,400 + $282,240) ÷ 143,000
= $314,640 ÷ 143,000
= $2.20 per unit
Now, For computing the Cost per equivalent unit of conversion first we need to find the equivalent unit of conversion cost which is below:-
= Transferred units + (
Department units × Conversion percentage)
= 135,000 + (20,000 × 15%)
= 135,000 + 3,000
= 138,000
So, the Cost per equivalent unit of conversion = (Beginning conversion cost + Current month conversion cost) ÷ Equivalent unit of conversion cost
= ($6,250 + $544,700) ÷ 138,000
= $550,950 ÷ 138,000
= 3.99
or $4 unit
