At Hodgson Corporation, direct materials are added at the beginning of the process and conversions costs are uniformly applied
Other details include:
Beginning WIP direct materials $32,000
Beginning WIP conversion costs $20,250
Costs of materials added $384,100
Costs of conversion added $271,125
WIP beginning (50% for conversion) 19,200 units
Units started 119,500 units
Units completed and transferred out 115,700 units
WIP ending (60% for conversion) 23,000 units
What is the cost per equivalent unit for conversion costs?
A) $2.32
B) $2.09
C) $2.25
D) $2.10
C
Explanation: C)
Conversion costs $20,250 + 271,125 = 291,375 / 129,500 units = 2.25
Units completed 115,700
WIP 23,000 × 60% 13,800
Total 129,500
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