Sandhill's is a high-end skincare line that has been created by dermatologists for people who have very dry skin. Sandhill's is very selective about who carries the company's line and therefore is considered a boutique label. Its best-selling product is a lightweight moisturizer that also contains a high level of SPF that customers have come to appreciate. Sandhill's produces the products in limited quantities to best ensure that each container receives the time and attention that it deserves to ensure high quality. As of December 31 of last year, a batch in process contained 280 units that were 60% complete for Conversion Costs (CC) and 100% complete for direct materials (DM) because all DM is added at the front-end of processing. During the current year, Sandhill's started 17,510 units and completed 16,860 units by the close of the year. Units remaining in ending inventory are 70% complete for CC and 100% complete for DM in the current year. Sandhill's had the following costs for the year that are associated with all of the units described above: Costs in beginning Work-in-Progress (WIP) Inventory Costs added to WIP Inventory this period (a) Equivalent cost per unit Currently, each unit is in a small, recyclable plastic container. Sandhill's uses the First-In, First-Out (FIFO) method of Process Costing. Using the information above, please answer the following questions. tA Total Costs $1,350 $400 $66,367 $29,767 Direct Materials What is the equivalent cost per unit for Direct Materials? What is the equivalent cost per unit for Conversion Costs? (Round final answers to 2 decimal places, e.g. 5.75.) 1.72 DM per unit CC $ $950 $36,600 Conversion Costs per unit
Sandhill's is a high-end skincare line that has been created by dermatologists for people who have very dry skin. Sandhill's is very selective about who carries the company's line and therefore is considered a boutique label. Its best-selling product is a lightweight moisturizer that also contains a high level of SPF that customers have come to appreciate. Sandhill's produces the products in limited quantities to best ensure that each container receives the time and attention that it deserves to ensure high quality. As of December 31 of last year, a batch in process contained 280 units that were 60% complete for Conversion Costs (CC) and 100% complete for direct materials (DM) because all DM is added at the front-end of processing. During the current year, Sandhill's started 17,510 units and completed 16,860 units by the close of the year. Units remaining in ending inventory are 70% complete for CC and 100% complete for DM in the current year. Sandhill's had the following costs for the year that are associated with all of the units described above: Costs in beginning Work-in-Progress (WIP) Inventory Costs added to WIP Inventory this period (a) Equivalent cost per unit Currently, each unit is in a small, recyclable plastic container. Sandhill's uses the First-In, First-Out (FIFO) method of Process Costing. Using the information above, please answer the following questions. tA Total Costs $1,350 $400 $66,367 $29,767 Direct Materials What is the equivalent cost per unit for Direct Materials? What is the equivalent cost per unit for Conversion Costs? (Round final answers to 2 decimal places, e.g. 5.75.) 1.72 DM per unit CC $ $950 $36,600 Conversion Costs per unit
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Sandhill's is a high-end skincare line that has been created by dermatologists for people who have very dry skin. Sandhill's is very
selective about who carries the company's line and therefore is considered a boutique label. Its best-selling product is a lightweight
moisturizer that also contains a high level of SPF that customers have come to appreciate. Sandhill's produces the products in limited
quantities to best ensure that each container receives the time and attention that it deserves to ensure high quality. As of December
31 of last year, a batch in process contained 280 units that were 60% complete for Conversion Costs (CC) and 100% complete for
direct materials (DM) because all DM is added at the front-end of processing. During the current year, Sandhill's started 17,510 units
and completed 16,860 units by the close of the year. Units remaining in ending inventory are 70% complete for CC and 100%
complete for DM in the current year. Sandhill's had the following costs for the year that are associated with all of the units described
above:
Costs in beginning Work-in-Progress (WIP) Inventory
Costs added to WIP Inventory this period
(a)
Equivalent cost per unit
Currently, each unit is in a small, recyclable plastic container. Sandhill's uses the First-In, First-Out (FIFO) method of Process Costing.
Using the information above, please answer the following questions.
LA
Total Costs
$1,350
$400
$66,367 $29,767
Direct Materials
What is the equivalent cost per unit for Direct Materials? What is the equivalent cost per unit for Conversion Costs? (Round final
answers to 2 decimal places, e.g. 5.75.)
1.72
DM
per unit
CC
$
$950
$36,600
Conversion Costs
per unit
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