Muzyka Corporation uses the FIFO method in its process costing system. Data concerning the first processing department for the most recent month are listed below: Note: Your answers may differ from those offered below due to rounding error. In all cases, select the answer that is the closest to the answer you computed. The cost per equivalent unit for materials for the month in the first processing department is closest to:
A)$23.14
B)$18.91
C)$21.42
D)$22.06

Question

Muzyka Corporation uses the FIFO method in its process costing system. Data concerning the first processing department for the most recent month are listed below:  Note: Your answers may differ from those offered below due to rounding error. In all cases, select the answer that is the closest to the answer you computed. The cost per equivalent unit for materials for the month in the first processing department is closest to:
A)$23.14 
B)$18.91 
C)$21.42 
D)$22.06

Quizplus · Accepted Answer

To calculate the cost per equivalent unit for materials using the FIFO method, we divide the total cost of materials added during the month by the equivalent units of materials. Total cost of materials added = $170,100 + $24,090 = $194,190. Equivalent units of materials = 5,000 + (3,000 x 100% FIFO) = 8,000. Therefore, cost per equivalent unit for materials = $194,190 / 8,000 = $24.2738, which is closest to $21.42. Therefore, the best choice is C.

Muzyka Corporation Uses the FIFO Method in Its Process Costing