(a) Process costing (7 marks)

The following information has been gathered from the production department of the XYZ Company for April. The XYZ production department uses a process costing system and manufactures a pasta sauce which uses two raw material components (RM1 and RM2).

Work in Process at 1 April (85% completed) 6,000

Units started during April 72,000

Completed and transferred to finished goods during April 75,000

Cost In WIP “1 April Current Month

Material – RM1 $14,460 $121,920

Material – RM2 6,510 75,800

Direct Labour 6,000 61,866

Factory overhead 7,500 77,334

Raw material RM1 is introduced at the beginning of the process while RM2 is added at the stage when the product is 60% complete. Conversion costs are incurred at a uniform rate throughout the process. On April 30, Work-in-Process is 35% complete. There were no losses or spoilage during processing.

Using the weighted average cost method, calculate the:

(i) cost per equivalent unit of production

(ii) cost of completed units for the month of April

(iii) closing value of WIP at the end of April.