Weatherly Lumber Company processes wood pulp for manufacturing various paper products. The company employs a process costing system for its manufacturing operations. All direct materials are added at the beginning of the process, and conversion costs are incurred uniformly throughout the process. This is the company’s production schedule for May:     Tons of Pulp Percent Completed Materials Conversion Work-in-Process Inventory, May 1 5,000 100% 50% Started during May 18,000     Units to account for 23,000     Units from beginning Work-in-Process, which were completed and transferred out during May 5,000     Started and completed during May 10,800     Work-in-Process Inventory, May 31 7,200 100% 50% Total units accounted for 23,000       The following cost data are available:   Work-in-Process Inventory, May 1   Direct materials $ 82,100 Conversion 61,342 Costs incurred during May   Direct materials 283,140 Conversion 358,280   Required: 1. Calculate the equivalent units of direct materials and conversion during May. Use the FIFO method. 2. Calculate the cost per equivalent unit for both direct materials and conversion during May. Use the FIFO method.

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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Weatherly Lumber Company processes wood pulp for manufacturing various paper products. The company employs a process costing system for its manufacturing operations. All direct materials are added at the beginning of the process, and conversion costs are incurred uniformly throughout the process. This is the company’s production schedule for May:

 

  Tons of Pulp Percent Completed
Materials Conversion
Work-in-Process Inventory, May 1 5,000 100% 50%
Started during May 18,000    
Units to account for 23,000    
Units from beginning Work-in-Process, which were completed and transferred out during May 5,000    
Started and completed during May 10,800    
Work-in-Process Inventory, May 31 7,200 100% 50%
Total units accounted for 23,000    

 

The following cost data are available:

 

Work-in-Process Inventory, May 1  
Direct materials $ 82,100
Conversion 61,342
Costs incurred during May  
Direct materials 283,140
Conversion 358,280

 

Required:

1. Calculate the equivalent units of direct materials and conversion during May. Use the FIFO method.

2. Calculate the cost per equivalent unit for both direct materials and conversion during May. Use the FIFO method.

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