The production manager of Alpha Herbs presented the following production data. He stated that, beginning inventory of work-in-progress (WIP) is 50,000 herbs which are 60% complete. Beginning WIP raw material inventory costs are $150,000. While, beginning WIP inventory of conversion costs are $427,500. He further stated that, all raw materials for the herbs are added at the beginning of production process. Conversion takes place continuously throughout the process. However, during the period, 125,000 herbs were started; and raw materials added during the period cost $725,000. Conversion costs for the period are $1,147,500. Ending WIP inventory is 25,000 herbs which was 30% complete.

Required:

a. Calculate the equivalent unit cost for direct material and conversion cost and value the outputs using the Weighted Average Method. Hint: Use two decimal places for equivalent unit costs per unit. (13 marks)

b. Calculate the equivalent unit cost for direct material and conversion cost and value the outputs using the First in First Out (FIFO) Method. Hint: Use two decimal places for equivalent unit costs per unit.