ECONOMICS

Detailed explanation-1: -To calculate the goods transferred out, simply take the units transferred out times the sum of the two equivalent unit costs (materials and conversion) because all items transferred to the next department are complete with respect to materials and conversion, so each unit brings all its costs.

Detailed explanation-2: -The total cost assigned to units transferred out equals the cost per equivalent unit times the number of equivalent units.

Detailed explanation-3: -Just like the name implies, COGM is the total cost incurred to manufacture products and transfer them into finished goods inventory for retail sale.

Detailed explanation-4: -Costs of units started and completed: you will take the equivalent units calculated for units started and completed x the cost per equivalent unit for materials, labor and overhead (or conversion). The sum of these 3 will be the cost of units completed and transferred which is also known as cost of goods manufactured.