Question

The Lakeside Company uses a weighted average process costing system. The following data are available: 22,800 17,400 Beginning inventory Units started in production Units finished during the period Units in process at the end of the period (complete as to materials, % complete as to labor and overhead) Cost of materials used Labor and overhead costs 5,400 $52,430 $45,060 Cost per equivalent unit of materials is: Multiple Choice O $2.30. O O $2.40. O $2.21. O $198.

Answer 1

Solution:- Computation of cost per Equivalent Unit of Material Firstly we Calculate the Equivalent Unit of Material Particulars Units % Material Equivalent Unit Unit of completed & transferred out 17,400 100% 17,400 Ending work in process Inventory 5,400 100% 5,400 Total Equivalent unit of Production for Material 22,800 -------- 22,800 In next Step we Calculate the Total Cost of Material Particulars Amount ($) Cost of Beginning work in process Inventory $0 Add:- Cost of Materials Used $52,430 Total Cost of Materials $52,430 In final Step we calculate the Cost per Equivalent Unit of Materials Cost Per Equivalent unit of Materials = Total Cost of Materials ÷ Equivalent Unit of production for Materials = $52,430 ÷ 22,400 units = $2.299 =$2.30 (Rounded) So the Correct Option is [a] i.e, $2.30