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Point 1: All direct materials are entered at the beginning of the manufacturing process. Labor is applied at an even rate in the production process and indirect costs are allocated based on labor hours. During the period, 15,000 were completed. There are now 5,000 units in Work in Process (WIP) that are one-half complete.
Cost
Material
Labor
Applied Indirect
Beginning WIP
$5,000
$2,000
Cost incurred
$30,000
$15,500
$47,500
Question 1: What is the equivalent cost per unit?
a. $5.75
b. $6.00
c. $4.75
d. $1.75
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