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The Assembly Department of Zoom Auto Parts Began April with No

question 69

Essay

The Assembly Department of Zoom Auto Parts began April with no work in process inventory. During the month, production that cost $71,345 (direct materials, $27,825, and conversion costs, $43,520) was started on 52,000 units. Zoom completed and transferred to the Testing Department a total of 43,000 units. The ending work in process inventory was 37.5% complete as to direct materials and 80% complete as to conversion costs.
Required:
A. Compute the equivalent units for direct materials and conversion costs.
B. Compute the cost per equivalent unit.

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Definitions:

Price Taker

An entity in a market that has no control over the prices at which it buys or sells goods, typically because it is too small to influence market prices.

Demand

The quantity of a good or service that consumers are willing and able to purchase at various price levels.

Total Revenue

The overall amount of money generated from sales of goods or services, calculated as quantity sold times price per unit.

Total Cost

The aggregate cost of all inputs used in the production of goods or services, including fixed and variable costs.

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