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4 August, 03:31

A company uses a process costing system. Its Assembly Department's beginning inventory consisted of 53,600 units, 75% complete with respect to direct labor and overhead. The direct labor beginning inventory costs were $9,800. The department completed and transferred out 118,500 units this period. The ending inventory consists of 43,600 units that are 25% complete with respect to direct labor and overhead. All direct materials are added at the beginning of the process. The department incurred direct labor costs of $33,000 and overhead costs of $41,000 for the period. Assuming the weighted average method, the direct labor cost per equivalent unit (rounded to the nearest cent) is:

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  1. 4 August, 03:57
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    EU cost for direct labor $ 0,33

    Explanation:

    weighted average will be the transferred units plus percentage of completion on ending WIP

    118,500 transferred + 43,600 x 25% = 129,400 units

    labor cost on beginning WIP 9,800

    added cost during the perod 33,000

    Total cost 42,800

    Equivalent untis cost: $ 42,800 / 129,800 = 0,329738
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