Happy Company manufactures tape dispensers. The Assembly Department reported the

Question

Happy Company manufactures tape dispensers. The Assembly Department reported the follow data for the past month:

Units started and completed:       70,000

Units started and not complete : 10,000

Units in beginning inventory:     0

Direct materials costs:        $560,000

Conversion costs:       $240,000

The partially complete units at the end of the month were 100 percent complete with respect to materials and 60 percent complete with respect to conversion costs. The unit cost of direct materials is ________.

A. $6.86

B. $3.32

C. $1.67

D. $7.00

Explanation / Answer

we have conversion cost = 240000

so total cost requaired= (70,000+0.6*10,000)*x= 240,000

or x= 3.32

ans- B

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