Zimmerman Company manufactures plastic cups in one department. The following information is available: Work-In-Process Inventory, beginning 0 Units started 60,000 Units completed and transferred 48,000 Work-In-Process Inventory, end 12,000 Direct materials added $180,000 Direct labor $165,600 Factory overhead $82,800 The units in the ending Work-In-Process Inventory are 50 percent complete with respect to direct materials and 60 percent complete with respect to conversion costs. The unit cost of direct materials is

Question

Jerry Meyer

Business

7 January, 13:08

Zimmerman Company manufactures plastic cups in one department. The following information is available: Work-In-Process Inventory, beginning 0 Units started 60,000 Units completed and transferred 48,000 Work-In-Process Inventory, end 12,000 Direct materials added $180,000 Direct labor $165,600 Factory overhead $82,800 The units in the ending Work-In-Process Inventory are 50 percent complete with respect to direct materials and 60 percent complete with respect to conversion costs. The unit cost of direct materials is

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Answers (1)

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Cordell Blackburn · Answer 1

Material cost per unit = $3.33

Explanation:

Item units Equivalent unit

Transferred out 48,000 48,000 * 100 48,000

Closing WIP 12,000 12,000 * 50% 6,000

Total equivalent unit 54,000

unit Cost of direct material = direct material cost/equivalent units

= 180,000/54000

=$3.33