Perrette Motor Company rebuilds automobile engines that have been damaged or are in need of extensive repair. The rebuilt engine has a 100,000-mile warranty and is purchased by auto shops, large motor pools in companies and governmental units, and some individual auto owners. The plant in Dayton, Ohio, specializes in the Ford V6 engine. Approximately 870 to 1,070 engines are rebuilt each month, and the costs of the plant are assigned to monthly production using weighted-average process costing. The current month began with a Work-in-Process Inventory of 280 engines, which were 50% complete for direct materials and 50% complete for conversion costs. The direct materials cost in beginning Work-in-Process was $116,800, while the conversion cost was $117,120. A total of 770 engines were completed and shipped out during the month, and total direct materials cost of $862,400 and conversion cost of $970,200 were incurred during the month. The ending Work-in-Process of 380 units was 50% complete for direct materials and 30% complete for conversion costs. Required: Compute the cost per equivalent unit for direct materials and conversion for the month. Direct materials Conversion Cost per Equivalent Unit
Perrette Motor Company rebuilds automobile engines that have been damaged or are in need of extensive repair. The rebuilt engine has a 100,000-mile warranty and is purchased by auto shops, large motor pools in companies and governmental units, and some individual auto owners. The plant in Dayton, Ohio, specializes in the Ford V6 engine. Approximately 870 to 1,070 engines are rebuilt each month, and the costs of the plant are assigned to monthly production using weighted-average process costing. The current month began with a Work-in-Process Inventory of 280 engines, which were 50% complete for direct materials and 50% complete for conversion costs. The direct materials cost in beginning Work-in-Process was $116,800, while the conversion cost was $117,120. A total of 770 engines were completed and shipped out during the month, and total direct materials cost of $862,400 and conversion cost of $970,200 were incurred during the month. The ending Work-in-Process of 380 units was 50% complete for direct materials and 30% complete for conversion costs. Required: Compute the cost per equivalent unit for direct materials and conversion for the month. Direct materials Conversion Cost per Equivalent Unit
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Perrette Motor Company rebuilds automobile engines that have been damaged or are in need of extensive repair. The rebuilt engine
has a 100,000-mile warranty and is purchased by auto shops, large motor pools in companies and governmental units, and some
individual auto owners. The plant in Dayton, Ohio, specializes in the Ford V6 engine. Approximately 870 to 1,070 engines are rebuilt
each month, and the costs of the plant are assigned to monthly production using weighted-average process costing. The current
month began with a Work-in-Process Inventory of 280 engines, which were 50% complete for direct materials and 50% complete for
conversion costs. The direct materials cost in beginning Work-in-Process was $116,800, while the conversion cost was $117,120. A total
of 770 engines were completed and shipped out during the month, and total direct materials cost of $862,400 and conversion cost of
$970,200 were incurred during the month. The ending Work-in-Process of 380 units was 50% complete for direct materials and 30%
complete for conversion costs.
Required:
Compute the cost per equivalent unit for direct materials and conversion for the month.
Direct materials
Conversion
Cost per
Equivalent Unit
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