Barnett Corporation uses the weighted-average method in its process costing syst

Question

Barnett Corporation uses the weighted-average method in its process costing system. The company adds materials at the beginning of the process in Department M. Conversion costs were 75% complete with respect to the 4,000 units in work in process at May 1 and 50% complete with respect to the 6,000 units in work in process at May 31. During May, 12,000 units were completed and transferred to the next department. An analysis of the costs relating to work in process at May 1 and to production activity for May follows: Materials Conversion Work in process May 1 $13,800 $3,740 Costs added during May $42,000 $26,260 The total cost per equivalent unit for May was:

Explanation / Answer

The total cost per equivalent unit for May was $5.10

Statement of Equivalent Production Equivalent Production Particulars Input Units Particulars Output Units Material Conversion Cost % Units % Units Beginning WIP 4000 Units Introduced 14000 Units Completed and transferred 12000 100 12000 100 12000 Ending WIP 6000 100 6000 50 3000 Total 18000 18000 18000 15000

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