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Question - Jenny Company manufactures doors. At the start of June, 2,500 units were in process. During June, 12,000 units were completed and 2,000 units were in process at the end of June. The in process units were 80% complete with respect to direct materials and 70% complete with respect to conversion costs.
Additional information is as follows:
Work in process, June 1:
Direct material $45,000
Conversion costs $60,000
Costs incurred during June:
Direct material $281,400
Conversion costs $340,000
1- What is the amount of cost per equivalent unit for direct materials using the weighted-average method?
2- Why is the weighted-average method preferred over the FIFO method of process costing?
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