Financial

Question 4

The following information pertains to Equator Company operations for one of the production departments for the month of June 2019:

Percent Completed

Units

Materials

Conversion

Work in process inventory, June 1

10,000

100%

70%

Work in process inventory, June 30

30,000

100%

30%

Material cost work in process inventory, June 1

$20,000

Conversion cost work in process inventory, June 1

$25,000

Units started into production during June

160,000

Units transferred to the next production department

140,000

Materials cost added during June

320,000

Conversion cost added during June

198,500

Required:

1. Determine the equivalent units for materials and conversion for the month of

June. (4 marks)

2. Compute the cost per equivalent unit for materials and conversion for the month of

June. (4 marks)

3. Determine the total cost of ending work in process inventory. (4 marks)

4. Determine the total cost of units transferred to the next Department in June.

(3 marks)