Question

The debits to Work in Process—Assembly Department for May, together with data concerning production, are as follows: May 1, work in process: Materials cost, 3,000 units $ 8,000 Conversion costs, 3,000 units, 66.7% completed 6,000 Materials added during May, 10,000 units 30,000 Conversion costs during May 31,000 Goods finished during May, 11,500 units 0 May 31 work in process, 1,500 units, 50% completed 0 All direct materials are placed in process at the beginning of the process and the first-in, first-out method is used to cost inventories. The materials cost per equivalent unit for May is a.$3.00 b.$2.92 c.$3.80 d.$2.31

Answer 1

Answer:

a.$3.00

Explanation:

The computation of the material cost per equivalent unit is shown below:

But before that equivalent units should be

= 3,000 ×0%+ (11,500 - 3,000) ×100% + 1,500 × 100%

= 0 + 8,500+ 1,500

= 10,000 units

Now the material cost per equivalent cost is

= $30,000 ÷ 10,000 units

= $3

Hence, the first option is correct