(TCO 3) ABC Company uses process costing to track its costs in two sequential

production departments: Forming and Finishing. The following information is provided regarding the Forming department.

Forming Department

Month Ended July 31

Unit information

Beginning work in process, July 1 — 10,000

Started into production during July — 21,000

Completed and transferred to Finishing department during July — 19,000

Ending work in process, July 31 (40% complete as to direct materials and 45% complete as to conversion costs) — 12,000

Cost information

Beginning work in process as of July 1 consists of $13,000 of direct materials costs and $6,500 of conversion costs) — $19,500

Direct materials used in July — $34,000

Conversion costs incurred in July — $14,850

Required:

(a) Calculate the equivalent units for direct materials. (Show your work)

(b) Calculate the cost per equivalent unit for direct materials. (Show your work)