B-20.03 Zeus Corporation produces cultured diamonds via a secretive process that grows thediamonds in a vacuum chamber filled with a carbon gas cloud. The diamonds areproduced in a single continuous process, and Zeus uses the weighted-average processcosting method of accounting for production.The production process requires constant utilization of facilities and equipment, as well asdirect labor by skilled technicians. As a result, direct labor and factory overhead are bothdeemed to be introduced uniformly throughout production. Zeus Corporation prepared the following “unit reconciliation” for the month of July:Unit Reconciliation: Beginning Work inProcessStarted into ProductionTotal Units intoProduction QuantitySchedule5,0006,00011,000 Equivalent Units Calculations:ConversionDirectMaterials DirectLabor FactoryOverhead To Finished Goods 8,000 8,000 8,000 8,000 Ending Work in Process 3,000 1,800 1,500 1,500 9,500 9,500 Total Units Reconciled 11,000 9,800 Ending WIP Completion Status:Materials = 60% and Conversion = 50% The above beginning work in process inventory had an assigned cost of $3,000,000,divided between direct materials (30%), direct labor (20%), and factory overhead (50%).Additional costs incurred during July were $9,500,000, divided between direct materials(15%), direct labor (25%), and factory overhead (60%).Prepare a schedule showing the calculation of cost per equivalent unit. Name:Date: B-20.03 Section: Cost Per Equivalent Unit:ConversionTotalCostBeginning Work inProcessCost incurred duringperiodTotal costEquivalent unitsCosts per equivalentunit DirectMaterials DirectLabor FactoryOverhead
