James 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 July 31
Beginning work in process, July 1 — 6,000
Started into production during July — 18,000
Completed and transferred to Finished Department during July — 16,000
Ending work in process, July 31 (30% complete as to direct materials and 40% complete as to conversion costs) — 8,000
Beginning work in process as of July 1 (consists of $5,000 of direct materials costs and $9,500 of conversion costs) — $14,500
Direct materials used in July — $27,936
Conversion costs incurred in July — $34,350
(a) Calculate the equivalent units for direct materials (Show your work)
(b) Calculate the cost per equivalent unit for direct materials (Show your work)
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