Answer:
The conversion cost per unit is $4.83
Explanation:
First step is to determine the Total Equivalent units of Production for Conversion costs.
Assuming that Maisley Company uses the FIFO method in its production, the following is the Total Equivalent Units of production for conversion costs :
To Finish Opening Work In Process 0
Started and Completed 28,000
Closing Work In Process (4,000 × 25%) 1,000
Total Equivalent Units of production 29,000
Then find cost per equivalent unit of production for conversion costs.
Cost per equivalent unit = Total Current Period Cost / Total Equivalent Units of production
= $140,000 / 29,000
= $4.827586
= $4.83
Conclusion :
The conversion cost per unit is $4.83
