 In this presentation, we will calculate the cost per equivalent unit using the weighted average method. In a prior presentation, we used this example data for our problem to compute the equivalent units of productions. We had the equivalent units of production calculated last time. Support Accounting Instruction by clicking the link below, I'm giving you a free month membership to all of the content on our website, broken out by category, further broken out by course. Each course then organized in a logical, reasonable fashion, making it much more easy to find what you need than can be done on a YouTube page. We also include added resources such as Excel practice problems, PDF files, and more like QuickBooks backup files when applicable. So once again, click the link below for a free month membership to our website and all the content on it. We have the units completed and transferred out of the department in June, the working process at the end of the month, and then equivalent units of production in the department during June, that with regard to materials and conversion. These are the units that we're considering now. Now we want to think about the dollar amounts. We need to think about the dollar amounts. These are going to be given within the problem as well. Notice we would know the dollar amounts. What we need to know is how to allocate those dollar amounts between the amounts that are still in the working process and the amounts that have been transferred out of the department. That's what we're trying to consider. In order to do that, we're going to use the units. We're going to consider the units here that we've now broken out to the units completed and transferred and the working process that's still in at the end of the time period. We're then going to use an estimate to get the cost per equivalent unit so that we can then apply out the costs to the amount that's still in working process and the amount that has been transferred out. Now we've got to consider the dollar amounts. We'll use dollar signs within Excel as we consider the dollar amounts. We're going to start with the working process in June first. We'll start with the materials over here and we're going to pull this amount from the table. This is given from the table. This is known from the prior time period. The prior time period, we have the 6, 7, 3, 1 for materials and then we have the conversion. The conversion we're going to pull from the table from the prior time period, the 4, 3, 1, 2. That's the 4, 3, 1, 2. If we sum those up, if I add these two up, it adds up to 11,043. We'll use the sum function to do that. I'm just going to sum these up. The total then, the working process at the beginning of the month, the amount that you could consider or think about in a T account or the GL account or the TRI bounce, 1143. Then costs that were added during the time period, cost added, we're going to say these are going to increase. We're just going to pull these from the table again. We know what they are because they're the actual costs. We don't know where to apply them to. That's what we're trying to do. The costs that are added are the 130, 483 for the cost added in materials and the cost added related to conversion then is going to be that 89, 243. Remember, we know what materials are. Conversion is the labor and the overhead. That's going to give us the total. We're going to say that's the total costs. We'll just sum that up. I'm going to add up first the costs added, which is going to be these two items, 219, 726. We'll use the equals SUM sum of those items. Then we'll add them up vertically. We've got the 237.69. I'm going to sum these up. Then I could copy that across or just sum up across. We're just summing all this up. Here's the total costs, materials, conversion, and the total. These two, of course, 237.69 adds up to that 237.69. Now we want to consider the equivalent units, so equivalent units. The equivalent units, remember, we calculated up top. We have the equivalent units that we calculated here, the total units. We broke them out, but now we're going to consider the total so that we can then use this number, the cost per equivalent unit, to break out for these totals, which we'll do next time. The equivalent units, not for the total, is going to be this number for the materials and this number for the conversion. That's what we calculated last time. This wasn't given in the problem, but we calculated it in the last presentation. That's going to give us our cost per equivalent unit. This is going to be a division problem. Here's the dollar amount 137214 for materials divided by the 6534. That's 21. Then the 93555 divided by the 6237 is the 15. We'll divide those out. This equals this number divided by this number. The dollar amount divided by the units gives us the dollar amount per unit. Notice this is all dollars. This is the unit's dollar amount per unit. Then we're going to say, this is the 93555 divided by the 623715. Notice we're in Excel and these happen to be perfectly rounded. We don't need pennies in this example by design, but obviously it wouldn't always be perfectly rounded. You'll have to deal with rounding to just be careful if you're dealing with a problem that deals with rounding. Now we've got the cost per equivalent unit. We can use this number now to apply out to the areas that we're concerned with because we want to break out between the units completed and transferred out of the department. The amount that's not in our department anymore in terms of dollars. We're going to use the units times the dollars to get that and the amount that's still there at the end of the time period. That's what we'll do next time when we assign the costs to units to then assign out the costs that are still in our department, the costs that should be transferred out to the next department.