Question

Ibarra Corporation uses the FIFO method in its process costing system.

Answer 1

Answer:

$5.70

Explanation:

The calculation of conversion costs for the month is given below:-

Units started to completed during the period = Units completed during the month - Units started during the month

= $104,000 - $16,400

= $87,600

So, to complete the started work in progress :-

The Conversion = $16,400 × (100% - 20%)

                          = $13,120

Units started to completed during the period $87,600

And, the ending work in progress

For Conversion = $13,400 × 30%

                          = $4,020

Therefore, the Equivalent production of units is

= $87,600 + $13,120 + $4,020

= $104,740

So, The cost of per per equivalent unit is

= Cost added during the period ÷ Equivalent units of production

= $597,123 ÷ $104,740

= $5.70