Badgersize Company has the following information for its Forming Department for the month of August.

Work in Process Inventory, August 1: 20,000 units

Direct materials: 100% complete $ 80,000

Conversion: 20% complete 24,000

Balance in work in process, August 1 $ 104,000

Units started during August 49,000

Units completed and transferred in August 60,000

Work in process (70% complete), August 31?

Costs charged to Work in Process in AugustDirect materials $140,000Conversion costs:Direct labor $105,000Overhead applied 148,000Total conversion $253,000Assume materials are added at the start of processing. Required:1. Calculate the equivalent units for the Forming Department for the month of August. 2. Find the cost per equivalent of input resource.

1. Calculate the equivalent units for the Forming Department for the month of August.

direct materials 60,000 units conversion 70,000 units

2. Find the cost per equivalent of input resource.

direct materials per unit $2.33 conversion cost per unit $3.61

Explanation:

beginning WIP 20,000 units:

direct materials 100% = 20,000 equivalent units $80,000

conversion 20% = 4,000 equivalent units $24,000

total $104,000

Units completed and transferred 60,000

Ending WIP = 20,000:

direct materials 100%

conversion costs 70% = 14,000 equivalent units

costs charged:

Direct materials $140,000

Direct labor $105,000

Overhead applied 148,000

equivalent units:

direct materials 60,000 since all materials are added at the beginning

conversion = units started + ending WIP - beginning WIP = 60,000 + 14,000 - 4,000 = 70,000 units

direct materials per unit = total direct materials / equivalent units = $140,000 / 60,000 = $2.33

conversion costs per unit = total conversion costs / equivalent units = $253,000 / 70,000 = $3.61