Joyner Inc. manufactures pillar candles. In October 2008, company production was

Question

Joyner Inc. manufactures pillar candles. In October 2008, company production was 26,800 equivalent units for direct material, 24,400 equivalent units for labor, and 21,000 equivalent units for overhead. During October, direct material, conversion, and overhead costs incurred were as follows:

Direct material $78,880
Conversion 138,480
Overhead 42,600

Beginning WIP Inventory costs for October was $14,920 for direct material, $20,020 for labor, and $9,900 for overhead. What was the October weighted average cost per equivalent unit for direct material, direct labor, and overhead?

Assume that Joyner Inc. had 3,600 Equivalent Units of Production (EUP) for direct material in October’s beginning WIP Inventory, 4,000 EUP for direct labor, and 3,960 EUP for overhead. What was the October FIFO cost per EUP for direct material, direct labor, and overhead?

Explanation / Answer

                                   Direct     Direct   
                                Materials     Labor     Overhead
October Production    26,800        24,400     21,000
(Equivalent units)

Beginning WIP Cost   $14,920     $20,020       $9,900
Cost incurred
during October        $78,880      $95,880    $42,600
Total Cost           $93,800    $115,900    $52,500
                            ============================
Weighted Average
Cost per unit        $3.50          $4.75         $2.50
                          ______________________________

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