Direct materials are added at the beginning of the process and conversions costs are uniformly applied.Other details include:
Required:
a.What are the total equivalent units for direct materials?
b.What are the total equivalent units for conversion costs?
c.What is the cost per equivalent unit for direct materials?
d.What is the cost per equivalent unit for conversion costs?
e.What is the total cost of units completed and transferred out?
f.What is the total cost of units remaining in ending WIP?
Definitions:
Factory Overhead
The indirect costs associated with manufacturing, such as utilities, maintenance, and salaries for production supervisors.
Work in Process Inventory
Inventory that includes all materials and components currently being used in the production of final products but are not fully assembled.
Process Costing System
An accounting system used to ascertain the cost of a product at each process or stage of manufacturing, suitable for industries producing homogeneous products.
Accounts Receivable
Money owed to a company by its customers for products or services that have been delivered but not yet paid for.
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