Kalox, Inc., manufactures an antacid product that passes through two departments

Question

Kalox, Inc., manufactures an antacid product that passes through two departments. Data for the first department follow: The beginning work in process inventory was 75% complete with respect to Materials and 60% complete with respect to labor and overhead. The ending work in process inventory was 55% complete with respect to materials and 35% complete with respect to labor and overhead. Assume that the company uses the weighted-average method of accounting for units and costs. Determine the costs per equivalent unit for May. (Round your answers to 2 decimal places. Omit the "$" sign in your rosponse.)

Explanation / Answer

Answer 1. Calculation of equivalent Units Particulars Units Eq. Units Material Labor Overhead WIP In the beginning in gallons 65000 Started in Processing in gallons 617000 682000 Completed during the Month 610000 610000 610000 610000 WIP In the end 72000 39600 25200 25200 682000 649600 635200 635200 Answer 2. Calculation of Costs per Equivalent Unit Material Labor Overhead Total WIP In the Beginning          68,500                 5,700               21,400                  95,600 Cost Incurred during May        905,900              70,524             264,440            1,240,864 Total Costs        974,400              76,224             285,840            1,336,464 Equivalent Units in Gallons 649600 635200 635200 Cost per Equivalent Unit               1.50                   0.12                    0.45

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