Problem
XYZ Company uses process costing to track its costs in two sequential production departments: Forming and Finishing. The following information is provided regarding the Forming department.
Forming Department Month Ended June 30
Unit information Beginning work in process, June 1 --- 6,000 units
Started into production during June --- 30,000 units Completed and transferred to Finishing Department during June ---
22,000 units Ending work in process, June 30 --- 14,000 units (25% complete as to direct materials and 40% complete as to conversion costs)
Cost information Beginning work in process as of June 1 consists of $10,000 of direct materials costs and $5,500 of conversion costs --- total: $15,500 Direct materials used in June --- $27,000 Conversion costs incurred in June --- $14,850 Please answer both of the following questions and show your calculation work:
(a) Calculate the number of total equivalent units for direct materials.
(b) Calculate the cost per equivalent unit for direct materials.