Annenbaum Corporation uses the weighted-average method in its process costing sy

Question

Annenbaum Corporation uses the weighted-average method in its process costing system. This month, the beginning inventory in the first processing department consisted of 400 units. The costs and percentage completion of these units in beginning inventory were Percent Complete 658 45% Cost $5,700 $6,800 Materials costs Conversion costs A total of 6,500 units were started and 5,900 units were transferred to the second processing department during the month. The following costs were incurred in the first processing department during the month: Materials costs Conversion costs Cost $125,500 $207,000 The ending inventory was 50% complete with respect to materials and 35% complete with respect to conversion costs. The cost per equivalent unit for conversion costs for the first department for the month is closest to

Explanation / Answer

Equivalent unit of conversion = (5900*100%+1000*35%) = 6250 units

Total conversion cost = 6800+207000 = 213800

Cost per equivalent unit for conversion = 213800/6250 = 34.208 per equivalent unit

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