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5 November, 02:36

Zimmerman Company manufactures plastic cups in one department. The following information is available: Work-In-Process Inventory, beginning 0 Units started 60,000 Units completed and transferred 48,000 Work-In-Process Inventory, end 12,000 Direct materials added $180,000 Direct labor $165,600 Factory overhead $82,800 The units in the ending Work-In-Process Inventory are 50 percent complete with respect to direct materials and 60 percent complete with respect to conversion costs. The unit cost of direct materials is

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  1. 5 November, 02:49
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    Material cost per unit = $3.33

    Explanation:

    Item units Equivalent unit

    Transferred out 48,000 48,000 * 100 48,000

    Closing WIP 12,000 12,000 * 50% 6,000

    Total equivalent unit 54,000

    unit Cost of direct material = direct material cost/equivalent units

    = 180,000/54000

    =$3.33
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