Compute the equivalent units of production

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Reference no: EM139818

Forrests Gameboards company manufactures games in three departments using a process cost system with an average cost flow assumption. Selected cost and production data for the Creation Department, the second department in the production process, for the month just ended, are as follows:

Units in beginning work in process 5,000
Units received from Mixing Department 25,000
Units transferred to Finishing Department 20,000
Units in ending work in process?
Units spoiled due to internal failure 3,000

Work in process, beginning inventory:

Cost from preceding department $ 4,200
Materials 1,960
Labour 895
Factory Overhead 685

Costs added during the period:

From preceding department $ 15,900
Materials 8,775
Labour 4,550
Factory Overhead 3,770

The games are inspected at the end of the process in the Creation Department to detect any spoiled batches. Ending inventory is 75% complete as to materials and 25% complete as to conversion costs. Spolage is assumed to occur at the end of the process.

Required:

1. Compute the equivalent units of production for each cost element in the Creation Dep. for the month just ended.

2. Determine the average cost per equivalent unit for each cost element.

Reference no: EM139818

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