Adventure Ltd produces top-quality mountain bikes. In January 2021, the company had the following activities: Direct materials are placed into production at the beginning of the process and conversion costs are incurred evenly throughout the process.

REQUIRED (show all your workings):

1. Prepare a Production Cost Worksheet using the weighted average method of costing including: For each cost category, compute equivalent units.

2. For each cost category, summarise total costs in January and calculate the cost per equivalent unit. (round to two decimal places for Cost per EU)

3. Assign costs to units completed and to units ending WIP.

Work in process, 1 January 2021 400 units, 25% complete Units started during January 2021 800 units Units completed during January 2021 900 units Work in process, 31 January 2021 300 units, 20% complete Cost of material in WIP (1 January 2021) $360,000 Conversion cost in WIP (1 January 2021) $440,000 Costs added during January: Direct material costs $2,000,000 Conversion costs $800,000 Work in process, 1 January 2021 400 units, 25% complete Units started during January 2021 800 units Units completed during January 2021 900 units Work in process, 31 January 2021 300 units, 20% complete Cost of material in WIP (1 January 2021) $360,000 Conversion cost in WIP (1 January 2021) $440,000 Costs added during January: Direct material costs $2,000,000 Conversion costs $800,000