A manufacturing plant produces goods with direct materials cost of $40,000, conversion costs $60,000, and beginning work in process 5,000 units, ending work in process 3,000 units.

• Requirements:
  • Calculate the equivalent units of production for direct materials and conversion costs.
  • Prepare a cost per equivalent unit schedule using the weighted average method.
  • Allocate costs to units completed and transferred out and ending work in process.
  • Discuss the advantages of process costing in manufacturing environments.
  • Analyze the impact of different costing methods on cost allocation and financial reporting.