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28 October, 02:11

Hache Corporation uses the weighted-average method in its process costing system. The first processing department, the Welding Department, started the month with 17,900 units in its beginning work in process inventory that were 20% complete with respect to conversion costs. The conversion cost in this beginning work in process inventory was $8,200. An additional 90,800 units were started into production during the month and 93,800 units were completed in the Welding Department and transferred to the next processing department. There were 14,900 units in the ending work in process inventory of the Welding Department that were 90% complete with respect to conversion costs. A total of $204,200 in conversion costs were incurred in the department during the month. The cost per equivalent unit for conversion costs for the month is closest to:a. $2.055b. $2.290c. $1.981d. $2.364

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  1. 28 October, 04:41
    0
    The cost per equivalent unit for conversion costs for the month is closest c. $1.981.

    Explanation:

    Conversion

    Units transferred to the next department 93,800

    Ending work in process:

    Conversion: 14,900 units * 90% 13,410

    Equivalent units of production 107,210

    Conversion

    Cost of beginning work in process inventory 8,200

    Costs added during the period 204,200

    Total cost 212,400

    Equivalent units of production 107,210

    Cost per equivalent unit 212,400 / 107,210 1.981
  2. 28 October, 04:43
    0
    WIP = $8,200

    Conversion costs = $204,200

    Total = $212,400

    Equivalent unit of conversion =

    = 14900*90%+17900 * (1-20%) - (-93800) - 17,900 = 13,410+14,320+93,800-17,900 = 103,630

    Cost per equivalent unit of conversion cost = 212,400/103,630 = $2.055

    So the answer is A
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Home » Business » Hache Corporation uses the weighted-average method in its process costing system. The first processing department, the Welding Department, started the month with 17,900 units in its beginning work in process inventory that were 20% complete with
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