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31 March, 22:11

Andrews Corporation uses a process costing system for manufacturing. The following information is available for the February in its Polishing Department:Equivalent units of production-direct materials 110,000 EUPEquivalent units of production-conversion 95,000 EUPCosts in beginning Work in Process-direct materials $49,000Costs in beginning Work in Process-conversion $36,000Costs incurred in February-direct materials $414,000Costs incurred in February-conversion

The cost per equivalent unit of production for conversion is:A. $9.26B. $4.21C. $5.85D. $5.05E. $4.97

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  1. 31 March, 22:28
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    C. $5.85

    Explanation:

    The computation of the conversion cost per equivalent unit is shown below:

    = (Costs in beginning Work in Process - conversion + Costs in beginning Work in Process-conversion) : (Equivalent units of production - conversion)

    = ($36,000 + $520,000) : (95,000 units)

    = ($556,000) : (95,000 units)

    = $5.85

    Simply we divide the total conversion cost by the conversion equivalent units
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