Question

Cost per Equivalent Unit

The cost of direct materials transferred into the Bottling Department of Rocky Springs Beverage Company is $158,080. The conversion cost for the period in the Bottling Department is $65,280. The total equivalent units for direct materials and conversion are 24,700 ounces and 27,200 ounces, respectively.

Determine the direct materials and conversion costs per equivalent unit. If required, round to the nearest cent.

Direct materials cost per equivalent unit:	$ per ounce
Conversion costs per equivalent unit:	$ per ounce

Answer 1

Calculate cost per equivalent unit :

Cost per equivalent unit = Total Cost/Equivalent unit

Direct materials cost per equivalent unit: (158080/24700)	$6.40 per ounce
Conversion costs per equivalent unit: (65280/27200)	$2.40 per ounce