The Finishing Department of the Maherajah Competition Water Ski Company has the following production and cost data for May 2022: Transferred out: 1,760 water skis. Ending work in process: 340 water skis that are 25% completed at May 31st. Materials added: $114,400; conversion costs incurred: $84,480. Materials are entered at the beginning of the process. Conversion costs are incurred uniformly during the process. Instructions (a) Compute the equivalent units of production for materials and conversion costs for the month of May, 2022. (b) Compute unit costs and prepare a cost reconciliation schedule.

My solution is below:

a. Compute the equivalent units of production for materials and conversion costs.

		Equivalent Units
	Units	Materials	Conversion Costs
Units accounted for Transferred out Work in process, May 31 Total units	1,760 340 2,100	1,760 340 2,100	1,760 *85 1,845

*340 x 25%

b. Compute unit costs and prepare a cost reconciliation schedule.

Unit Costs:

Materials costs per unit = $ 54.47(114,400/2,100 units)

Conversion cost per unit = 45.78(84,480/1,845 units)

$100.25

Cost Reconciliation Schedule	Conversion Cost	Total
Costs accounted for Transferred out (1,760 x $100.25) Work in process, May 31 Materials (340 x $54.47) Conversion costs (85 x $45.78) Total costs	$18,519.80 3,891.30	$176,440 22,411.10 $198,851.10