Parandah Electronics Ltd., located in England, assembles a standard electrical component from parts it purchases from various suppliers. The production process consists of several steps, starting with assembly, which takes place in the Assembly Department. The company recently hired a new accountant, who prepared the following report for the department for May, using the weighted-average method:

Quantity Schedule
Units to be accounted for:
Work in process, May 1 (materials 90% complete; conversion 80% complete)	8,000
Started into production	26,000
Total units	34,000
Units accounted for as follows:
Transferred to next department	28,000
Work in process, May 31 (materials 75% complete; conversion 50% complete)	6,000
Total units	34,000

Cost Reconciliation
Cost to be accounted for:
Work in process, May 1		13,400
Cost added in the department		87,800
Total cost to be accounted for		101,200
Cost accounted for as follows:
Work in process, May 31		12,450
Transferred to next department		88,750
Total cost accounted for		101,200

The companys management would like some additional information about Mays operation in the Assembly Department. (The currency in England is the pound, denoted by the symbol .)

Required:

1. How many units were started and completed during May?

2. What were the equivalent units for May for materials and conversion costs?

3. What were the costs per equivalent unit for May? The following additional data are available concerning the departments costs: (Round your answers to 2 decimal places.)

	Materials			Conversion			Total
Work in process, May 1		9,000			4,400			13,400
Costs added during May		56,000			31,250			87,250

4. Calculate the material cost and the conversion cost of the ending work in process. (Round Cost per equivalent unit to 2 decimal places.)

5. The new manager of the Assembly Department is asked to estimate the incremental cost of processing an additional 1,000 units through the department. He takes the unit cost for an equivalent whole unit that you computed in (3) above and multiplies this figure by 1,000. Will this method yield a valid estimate of incremental cost?

multiple choice

• Yes

• No