Problem: Pablo Company calculates the cost for an equivalent unit of production using process costing.
Data for June
Work-in-process inventory, June 1: 10,000 units
|
Direct materials: 100% complete
|
$20,000
|
|
Conversion: 40% complete
|
8,000
|
|
Balance in work-in-process, June 1
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$28,000
|
|
Units started during June
|
26,000
|
|
Units completed and transferred out
|
26,000
|
|
Work-in-process inventory, June 30
|
10,000
|
|
Direct materials: 100% complete
|
|
|
Conversion: 80% complete
|
|
|
Costs incurred during June
|
|
|
Direct materials
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$44,200
|
|
Conversion costs
|
|
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Direct labor
|
44,200
|
|
Applied overhead
|
65,000
|
|
Total conversion costs
|
$109,200
|
Required: Compute the cost per equivalent unit for both the weighted-average and FIFO methods.