# Accounting Essay

3286 Words Jan 31st, 2013 14 Pages
CHAPTER 17
PROCESS COSTING

17-16 (25 min.) Equivalent units, zero beginning inventory.

1. Direct materials cost per unit (\$720,000 ÷ 10,000) \$ 72 Conversion cost per unit (\$760,000 ÷ 10,000) 76 Assembly Department cost per unit \$148

2a. Solution Exhibit 17-16A calculates the equivalent units of direct materials and conversion costs in the Assembly Department of International Electronics in February 2007. Solution Exhibit 17-16B computes equivalent unit costs.

2b. Direct materials cost per unit \$ 72 Conversion cost per unit 80 Assembly Department cost per unit \$152

3. The difference in the Assembly Department cost per unit calculated in requirements 1 and 2 arises because the costs incurred in
SOLUTION EXHIBIT 17-16B

Compute Cost per Equivalent Unit,
Assembly Department of International Electronics for February 2007.

| |Total | | |
| |Production |Direct |Conversion |
| |Costs |Materials |Costs |
|(Step 3) Costs added during February |\$1,480,000 |\$720,000 |\$760,000 |
| Divide by equivalent units of work done | | | |
|in current period (Solution Exhibit 17-l6A) | |( 10,000 |( 9,500 |
| Cost per equivalent

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