Question

Inacio Corporation uses the weighted-average method in its process costing system. Data concerning the first processing department for the most recent month are listed below: Beginning work in process inventory: Units in beginning work in process inventory 2,700 Materials costs $14,800 Conversion costs $6,900 Percent complete with respect to materials 75 % Percent complete with respect to conversion 20 % Units started into production during the month 11,400 Units transferred to the next department during the month 10,300 Materials costs added during the month $173,900 Conversion costs added during the month $243,900 Ending work in process inventory: Units in ending work in process inventory 3,800 Percent complete with respect to materials 90 % Percent complete with respect to conversion 30 % The cost per equivalent unit for materials for the month in the first processing department is closest to:________.a. $13.17.b. $14.11.c. $12.86.d. $15.12.

Answer 1

Answer:

Option D , $15.12

Explanation:

Weighted-average method :

Materials

Units transferred to the next department = 10,300

Ending work in process:

Materials: 1,200 units × 90%  = 1080

Equivalent units of production  =10,300+1080= 11,380

Materials

Cost of beginning work in process inventory= $2,700

Costs added during the period  = $173,900

Total cost (a)  =$173,900+$2,700 = $176,600

Equivalent units of production (b)= 11,380

Cost per equivalent unit (a) ÷ (b) = $15.51

The cost per equivalent unit for materials for the month in the first processing department is closest to $15.51