Hershey Chocolate Company uses a weightedaverage process cos

Hershey Chocolate Company uses a weighted-average process costing system. Hershey provides the following data:

  Beginning inventory

-0-  

  Units started in production

35,400  

  Units finished during the period

30,000  

  Units in process at the end of the period
  (Complete as to materials, 1/4 complete as to labor and overhead)

5,400  

  Cost of materials used

$

61,200  

  Labor and overhead costs

$

112,860  

Equivalent units of production for labor and overhead are:

30,000.

35,400.

31,350.

32,700.

Some other amount.

Solution

Equivalent unit of labour and overhead = Unit transferred out+(Ending work in process*percent completion)

                                                                = 30000+(5400*1/4)

Equivalent unit of labour and overhead = 31350

So answer is c) 31350