XYZ Company uses process costing to track its costs in two sequential production departments: Forming and Finishing. The following information is provided regarding the Forming department.
Month Ended June 30
Beginning work in process, June 1 — 6,000
Started into production during June — 30,000
Completed and transferred to Finishing Department during June — 22,000
Ending work in process, June 30 (25% complete as to direct materials and 40% complete as to conversion costs) — 14,000
Beginning work in process as of June 1 consists of $10,000 of direct materials costs and $5,500 of conversion costs) — $15,500
Direct materials used in June — $27,000
Conversion costs incurred in June — $14,850
(a) Calculate the equivalent units for direct materials.
(b) Calculate the cost per equivalent unit for direct materials.