Question

Weatherly Lumber Company processes wood pulp for manufacturing various paper products. The company employs a process costing system for its manufacturing operations. All direct materials are added at the beginning of the process, and conversion costs are incurred uniformly throughout the process. This is the company's production schedule for May Percent Complete Tons of Pulp Materials Conversion Work-in-Process Inventory, May 1 Started during May Units to account for 4, 000 16,000 20,000 100 50% Units from beginning Work-in-Process, which were completed and transferred out during May Started and completed during May Work-in-Process Inventory. May 31 Total units accounted for 4, 000 9, 600 6, 400 20, 000 100% 50% The following cost data are available: Work-in-Process Inventory, May 1 Direct materials Conversion 59,800 68,528 Costs incurred during May Direct materials Conversion 253, 600 387,760 Required 1. Calculate the equivalent units of direct materials and conversion during May. Use the FIFO method 2. Calculate the cost per equivalent unit for both direct materials and conversion during May. Use the FIFO method.

Answer 1