Question:
Overhill Company uses the FIFO method in its process costing system. In the Cutting Department in June, units were 80% complete with respect to conversion in the beginning work in process inventory and 25% complete with respect to conversion in the ending work in process inventory. Other data for the department for June follow:
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Conversion
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Units
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Cost
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Beginning work in process inventory
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20,000
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$40,000
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Units started into production, and costs incurred during
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the month .
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Units completed and transferred out .
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150,000
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$186,000
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Beginning work in process inventory
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130,000
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The cost per equivalent unit for conversion cost is closest to:
A) $1.48
B) $1.50
C) $1.16
D) $1.82