Ford Motor Company uses process costing for its truck assembly. In August 2033, the company incurs costs of $3,500,000 and processes 20,000 units. The beginning work in process was 5,000 units that were 80% complete. During the month, 18,000 units were completed and transferred out. Ending work in process was 7,000 units, 40% complete.

Required:

• Calculate the equivalent units of production for direct materials and conversion costs.
• Determine the cost per equivalent unit for direct materials ($175 per unit) and conversion costs ($90 per unit) using the weighted average method.
• Allocate costs to completed units and units in ending work in process.