Pacific Products Inc. completed and transferred 55,000 particle board units of p

Question

Pacific Products Inc. completed and transferred 55,000 particle board units of production from the Pressing Department. There was no beginning inventory in process in the department. The ending in-process inventory was 1,400 units, which were 3/5 complete as to conversion cost. All materials are added at the beginning of the process. Direct materials cost incurred was $203,040, direct labor cost incurred was $38,900, and factory overhead applied was $28,108. Determine the following for the Pressing Department. Round "cost per equivalent unit" answers to the nearest cent. a. Total conversion cost $ b. Conversion cost per equivalent unit $ c. Direct materials cost per equivalent unit $

Explanation / Answer

answer and explanation for C: "All materials are added at the beginning of the process." -- This is the key. It means that they are 100% complete with respect to direct materials. Ending inventory = 1,400 units completed and transferrfed = 55,000 units total = 56,400 physical units since 100% complete for direct materials, 56,400 equivalent units. 203,040/56,400 = $3.60 per equivalent unit

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