Pureform, Inc., uses the weighted-average method in its process costing system.

Question

Pureform, Inc., uses the weighted-average method in its process costing system. It manufactures a product that passes through two departments. Data for a recent month for the first department follow: Overhead Units Materials 77,000 68,900 31,500 43,500 Labor Work in process inventory, beginning Units started in process Units transferred out Work in process inventory, ending Cost added during the month 729,e00 750,000 56,000 911,380 388,7ee 537,140 The beginning work in process inventory was 70% complete with respect to materials and 55% c overhead. The endi and overhead. omplete with respect ng work in process inventory was 50% complete with respect to materials and 25% complete with respect to labor Required: 1. Compute the first department's equivalent units of production for materials, labor, and overhead for the month. 2. Determine the first department's cost per equivalent unit for materials, labor, and overhead for the month. (Round your answers to 2 decimal places.) Materials Labor Overhead 1. Equivalent units of production 2. Cost per equivalent unit K Pre 3 of 3 Next

Explanation / Answer

UNITS TO ACCOUNT FOR: Beginning Work in Process units 77,000 Add: Units Started in Process 729,000 Total Units to account for: 806,000 UNITS TO BE ACCOUNTED FOR: Units started and completed 750,000 Ending Work in Process 56,000 Total Units to be accounted for: 806,000 Equivalent Units: Material Cost labour Overheads % Completion Units % Completion Units % Completion Units Units started and completed 100% 750,000 100% 750,000 100% 750,000 Ending Work in Process 50% 28,000 25% 14,000 25% 14,000 Total Equivalent units 778,000 764,000 764,000 TOTAL COST TO ACCOUNT FOR: Material Labour Overheads Cost in Beginning WIP 68900 31500 43500 Cost Added during May 911,380 388,700 537,140 Total Cost to account for: 980,280 420,200 580,640 Total Cost to account for: 1,981,120 COST PER EQUIVALENT UNIT: Material Labour Overheads Total cost added during the year 980,280 420,200 580,640 Equivalent Units 778,000 764,000 764,000 Cost per Equivalent unit 1.26 0.55 0.76 MATERIAL LABOUR CONVERSION 1. Equivalennt units of production 778000 764000 764000 2. Cost per Equivalent units 1.26 0.55 0.76

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