During December, the production department of a process operations system comple

Question

During December, the production department of a process operations system completed and transferred to finished goods a total of 59,000 units of product. At the end of March, 15,000 additional units were in process in the production department and were 50% complete with respect to materials. The beginning inventory included materials cost of $60,100 and the production department incurred direct materials cost of $190,800 during December. Compute the direct materials cost per equivalent unit for the department using the weighted-average method

Explanation / Answer

Cost per equivalent unit = $250,900 / 66,500 = $3.77

EUP and cost per EUP DM Completed and transferred(59,000 * 100%) 59,000 Ending Work in Process Direct materials(15,000 * 50%) 7,500 Equivalent units 66,500 Costs of beginning inventory $60,100 Costs incurred this period $190,800 Total costs $250,900

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