Department F had 4,000 units in Work in Process that were 40% completed at the beginning of the period at a cost of $12,500. Of the $12,500, $8,000 was for material and $4,500 was for conversion costs. 14,000 units of direct materials were added during the period at a cost of $28,700. 15,000 units were completed during the period, and 3,000 units were 75% completed at the end of the period. All materials are added at the beginning of the process. Direct labor was $32,450 and factory overhead was $18,710.
If the average cost method is used, the materials cost per unit (to the nearest cent) would be
A) $2.04
B) $1.59
C) $1.91
D) $2.00

Question

Quizplus · Accepted Answer

The average cost per unit is calculated by dividing the total cost of materials by the total number of units. In this case, the total cost of materials is $28,700 + $8,000 = $36,700. The total number of units is 14,000 + 4,000 = 18,000. Therefore, the average cost per unit is $36,700 / 18,000 = $2.04.

Department F Had 4,000 Units in Work in Process That