Jake the Snake Company manufactures tape dispensers. Its Assembly department had the following output and costs: Units started and completed 70,000
Started and in process 10,000
These units had all materials added but were only 60% complete as far as conversion costs. Direct materials costs were $480,000; conversion costs were $240,000. The cost of one completed unit in the Assembly department is:

Question

Quizplus · Accepted Answer

The cost of one completed unit is calculated by dividing the total costs by the equivalent units of production. Total costs = $480,000 (materials) + $240,000 (conversion) = $720,000. Equivalent units for conversion = 70,000 + (10,000 * 60%) = 76,000. Cost per unit = $720,000 / 76,000 = $9.47.

Jake the Snake Company Manufactures Tape Dispensers