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10 September, 17:31

ink Company uses a process cost system and the weighted average method. During the year the company completed 1,300 units of product. Ending inventory consisted of 400 units that were 50% complete. The total dollar cost associated with production of inventory was $90,000. The cost per equivalent whole unit would be which of the following

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  1. 10 September, 19:30
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    The Cost per Equivalent Whole Unit would be of $60

    Explanation:

    Units of product completed during the year: 1,300

    Ending Work in Process Inventory: 400 units

    Ending Work in Process percent of completion: 50%

    Equivalent units in process: 200 (400 units x 50%)

    Total Equivalent Units (completed + in process) : 1,500

    Total production cost of inventory: $90,000

    Cost per Equivalent Unit: Total production cost / Total Equivalent Units

    Cost per Equivalent Unit: $90.000 / 1500 units = $60
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