Pingu Pty Ltd produces Whey Protein Isolate.

Process 2 involves condensing the Whey ready for isolation.

For process 2, the Direct Materials are added at the beginning of the process and conversion costs are uniformly incurred.

At the beginning of January, work-in-process is 60% complete and at the end of the month it is 70% complete. Other data for the month includes:

Beginning work-in-process inventory 18000 units

Units started 200000 units

Units completed and transferred to process 3 210,000 units

Conversion costs $1,800,000

Cost of direct materials $12,400,000

Beginning work-in-process costs:

Materials $1,163,000

Conversion $1,800,000

Cost of direct materials $826,000