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Equivalent Units and Cost per Equivalent Unit Weighted-Average Method LO2 LO3 Kalox, Inc., manufactures an antacid product that passes through two departments Data for May for the first

Equivalent Units and Cost per Equivalent Unit—Weighted-Average Method [LO2, LO3]

Kalox, Inc., manufactures an antacid product that passes through two departments. Data for  May

for the first department follow:

 

 

Gallons

Materials

Labor

Overhead

Work in process, May 1 . . . . . .

80,000

$68,600

$30,000

$48,000

Gallons started in process . . . .

760,000

 

 

 

Gallons transferred out . . . . . . .

790,000

 

 

 

Work in process, May 31 . . . . .

50,000

 

 

 

Cost added during May . . . . . .

 

$907,200

$370,000

$592,000

 

The beginning work in process inventory was 80% complete with respect to materials and 75% complete with respect to labor and overhead. The ending work in process inventory was 60% complete with respect to materials and 20% complete with respect to labor and overhead.

 

 

 

Required:

Assume that the company uses the weighted-average method of accounting for units and costs.

1.       Compute the equivalent units for May’s activity for the first department.

2.       Determine the costs per equivalent unit for May.

Jun 28 2020 View more View Less

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