Scrooge and Zilch, a public accounting firm in London, is engaged in the preparation of income tax returns for individuals. The firm uses the weighted-average method of process costing for internal reporting. The following information pertains to February. (£ denotes the British monetary unit, pounds sterling.)*

Required:
1. Compute the following amounts for labor and for overhead:

a. Equivalent units of activity.

b. Cost per equivalent unit. (Remember to express your answer in terms of the British pound sterling, denoted by £.)
2. Compute the cost of returns in process as of February 28.

Transcribed Image Text:

Returns in process, February 1: (25% complete)... Returns started in February. Returns in process, February 28: (80% complete!)....... Returns in process, February 1: 200 825 125 25 Labor 6,000 Overhead. 2,500 Labor, February (4,000 hours).. 89,000 Overhead, February......... 45,000 *Although the euro is used in most European markets, day-to-day business in the United Kingdom continues to be conducted in pounds sterling.