Answer:
Cost per equivalent unit for conversion costs for the month = $8.262
Explanation:
The weighted average cost of valuation does not separate the opening inventory from the units newly introduced when accounting for completed units in a production period.
To determine the cost per equivalent units using Weighted Average Method, follow the steps below:
<em>Step 1: Determine the equivalent Unit</em>
Completed units = 25000+ 97000- 28000 = 94000
Workings Equiva. Units
Completed units 94000 (94000 *100%) = 94,000
Closing WIP 28000 (28,000 * 10%) = 2,800
Total Equivalent units 96,800.00
<em>Step 2 : calculate total conversion cost </em>
= 51820+747970= 799,790.00
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<em>Step 3 = Cost per Equivalent unit per conversion cost</em>
Cost per unit = Total conversion cost/total Equivalent units
= 799,790.00 / 96,800.00
= $8.262
Cost per equivalent unit for conversion costs for the month = $8.262
