# Vermont Instruments manufactures two models of calculators. The finance model is the Fin-X and the scientific model is the Sci-X.

Vermont Instruments manufactures two models of calculators. The finance
model is the Fin-X and the scientific model is the Sci-X. Both models are
assembled in the same plant and require the same assembling operations.
The difference between the models is in the cost of the parts. The following
data are available for June:
Fin-X Sci-X Total
Number of units 9,000 43,000 52,000
Parts cost per unit $21$28
Other costs:
Direct labor $55,000 Indirect materials 19,000 Overhead 82,000 Total$156,000
Vermont Instruments uses operations costing and assigns conversion costs
based on the number of units assembled.
Compute the cost per unit of the Fin-X and Sci-X models for June.

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Fin-X total parts cost = $250,000 Sci-X total parts cost = Units of Sci-X × Sci-X parts cost per unit = 40,000 ×$30

Sci-X total parts cost = $1,200,000 Step 2: Assignment of total conversion cost of Fin-X and Scin-X Fin-X portion of conversion cost = (Units of Fin-X ÷ Total units) × Total conversion cost = (10,000 ÷ 50,000) ×$150,000

Fin-X portion of conversion cost = $30,000 Sci-X portion of conversion cost = (Units of Sci-X ÷ Total units) × Total conversion cost = (40,000 ÷ 50,000) ×$150,000

Sci-X portion of conversion cost = $120,000 Step 3: Calculation of total cost of Fin-X and Scin-X Fin-X total cost = Fin-X total parts cost + Fin-X portion of conversion cost =$250,000 + $30,000 Fin-X total cost =$280,000

Sci-X total cost = Sci-X total parts cost + Sci-X portion of conversion cost

= $1,200,000 +$120,000

Sci-X total cost = $1,320,000 Step 4: Calculation of cost per unit for Fin-X and Scin-X Fin-X cost per unit = Fin-X total cost ÷ Units of Fin-X =$280,000 ÷ 10,000

Fin-X cost per unit = $28 per unit Sci-X cost per unit = Sci-X total cost ÷ Units of Sci-X =$1,320,000 ÷ 40,000

Sci-X cost per unit = $33 per unit Conclusion The cost per unit of the Fin-X model is$28 and the cost per unit of the Sci-X model is \$33.