Question
AAC company is reviewing the behaviour of its various activities. AAC is considering various costs under process costing system. Its costing system utilises two cost
AAC company is reviewing the behaviour of its various activities. AAC is considering various costs under process costing system. Its costing system utilises two cost categories, direct materials and conversion costs. Direct materials are added at the beginning of production. Conversion costs are allocated evenly throughout production. AAC uses weighted-average costing. Data for the Assembly Department for June 2013 are:
| Work in process, beginning inventory 250 units | |
| Direct materials (100% complete) | |
| Conversion costs (50% complete) | |
| Units started during June 800 units | |
| Units sold during June 700 units | |
| Work in process, ending inventory: 150 units | |
| Conversion costs (75% complete) |
Costs for June 2013: Work in process, beginning inventory:
| Direct materials | $180,000 | |
| Conversion costs | 270,000 | |
| Direct materials costs added during June | 1,000,000 | |
| Conversion costs added during June | 1,000,000 |
What is the conversion cost per equivalent unit in June?
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Accounting Principles
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
13th edition
978-1-119-4110, 1119411483, 9781119411017, 978-1119411482
