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Carmelita Inc., has the following information available:
Costs from Beginning Inventory Costs from Current Period Direct materials $2,000 $22,252 Conversion costs 6,200 150,536
At the beginning of the period, there were 500 units in process that were 60% complete as to conversion costs and 100% complete as to direct materials costs. During the period, 4,500 units were started and completed. Ending inventory contained 340 units that were 30% complete as to conversion costs and 100% complete as to materials costs. The company uses the FIFO process cost method.
The cost of completing a unit during the current period was:______.
a. $34.88
b. $36.19
c. $35.95
d. $35.89

Respuesta :

Zviko

Answer:

c. $35.95

Explanation:

Step 1 : Equivalent units

Materials

To finish Opening Work In Process (500 x 0%)               0

Started and Completed (4,500 x 100%)                     4,500

Ending Work in Process (340 x 100%)                          340

Equivalent units of Production                                    4,840

Conversion

To finish Opening Work In Process (500 x 40%)        200

Started and Completed (4,500 x 100%)                   4,500

Ending Work in Process (340 x 30%)                           102

Equivalent units of Production                                  4,802

Step 2 : Cost per equivalent unit

Materials = $22,252  ÷ 4,840 = $4.60

Conversion Costs = $150,535  ÷   4,802 = $31.35

Therefore,

Total Unit Cost = $4.60 + $31.35 = $35.95

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