Montoya Company manufactures polyurethane finish in a single production department. Production begins by blending various chemicals, initial cost, and ends by filling the containers. The containers are then transferred to the shipping department. Labor and overhead are added continuously throughout the process. Management has determined that 2% of good units is normal spoilage. Spoilage can be identified as soon as the chemicals are added. Factory overhead is applied at the rate of $3 per direct labor dollar.

	Costs
Work-in-process inventory, May 1
Direct Materials	$52,500
Direct Labor ($10 per hour)	8,500
May costs added:
Direct Materials	332,500
Direct Labor ($10 per hour)	38,500

	Units
Work-in-process inventory, May 1 (30% complete)	2,000
Transferred to Shipping Department	25,500
Work-in-Process Inventory, May 31 (70% complete)	5,500

Factory OH= 3*38,500= $115,500

A) Total equivalent units for materials under the FIFO method are calculated to be:

B) Total equivalent units for conversion under the FIFO method are calculated to be:

	C) Cost per equivalent unit for materials under the FIFO method is calculated to be (rounded): D) cost per equivalent unit for conversion under the FIFO method is calculated to be (rounded):