Answer:
a. Cost per equivalent units for the conversion cost =$ 1.6
b. Cost per equivalent unit for materials= $ 0.4
Explanation:
Campo Company
Particulars Units % of Completion Equivalent Units
Mat. Conversion Materials C. Costs
Transferred out, 960,000 100 100 960,000 960,000
+Ending inventory, 150,000 100 40 150,000 60,000
Total Equivalent Units 1110,000 1020,000
1)We first the total equivalent units and then the total costs.
Materials Conversion Costs
Beginning WIP inventory $ 35,670 $ 110,630
Current period costs $ 408,330 $ 1,521,370
Total Costs $ 444,000 $ 1632,000
2) We divide the total costs of materials and conversion with the total equivalent units of materials and conversion to get the unit cost.
a. Cost per equivalent units for the conversion cost =$ 1632,000/1020,000
= $ 1.6
b. Cost per equivalent unit for materials= $ 444,000/ 1110,000 =$ 0.4