Question

A golf ball manufacturer gives us its data for the year WIP Inventory, January 1 O units Units started 9,100 units Units completed and transferred out 5,800 units WIP Inventory, December 31 3,300 units Direct materials $15,078 Direct labor $7,300 Manufacturing Overhead $4,911 Units in ending WIP Inventory were 90% complete for materials and 60% complete for conversion costs. On December 31, the total costs of units completed and transferred would be closest to (Round intermediate calculations to the nearest cont and the final answer to the Dat dollar O A. $7,757 OB. $8,214 OC. $29,928 OD. $19,082 d

Answer 1

Equivalent unit of material = 5800+3300*90% = 8770

Equivalent unit of conversion = 5800+3300*60% = 7780

Cost per equivalent unit of material = 15078/8770 = 1.72

Cost per equivalent unit of conversion = (7300+4911)/7780 = 1.57

Cost of unit transferred out = (1.72+1.57)*5800 = 19082

So answer is d) $19082