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Question - JB Juice Company uses a manufacturing process that has two distinct stages: the juicing process (P1) and the straining process (P2). Raw material is consumed in P1 at the beginning of the process. No additional raw material is required in the second stage of the process (in P2). The following information pertains to the production of 5,000 units of output in March 2020:
Assume 5,000 units are 100% complete with respect to raw materials and conversion costs at the end of March. Assume that 2,000 units of product are half complete in the straining process (P2) at the end of March.
P1
P2
Direct raw materials
$120,000
$0
Direct labor
$40,000
$60,000
Equipment maintenance
$80,000
Plant depreciation
$100,000
Required -
a) What is the conversion costs for P1, the juicing process, total?
b) What is the conversion cost per unit of output for stage PI for the JB Juice Company?
c) What is the ending inventory value of work-in-process at the end of March? Assume no product remains in the juicing process (P1) at the end of March.
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