Universal Manufacturing uses a weighted-average process-costing system. All mate

Question

Universal Manufacturing uses a weighted-average process-costing system. All materials are introduced at the start of manufacturing, and conversion costs are incurred evenly throughout the process. The company's beginning and ending work-in-process inventories totaled 10,000 units and 15,000 units, respectively, with the latter units being 2/3 complete at the end of the period. Universal started 30,000 units into production and completed 25,000 units. Manufacturing costs follow. Beginning work in process: Materials, $60,000; conversion cost, $150,000 Current costs: Materials, $180,000; conversion cost, $480,000 Universal's equivalent-unit cost for materials is: $4.50. $6.00. $8.00. $9.60. some other amount.

Explanation / Answer

Direct materials cost per equivalent unit:

Total direct material cost = $ 240,000

Total units = 25,000

$240,000 /25,000 = $9.60 direct materials cost per equivalent unit

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