The following production data were taken from the records of the Fishing Departm

Question

The following production data were taken from the records of the Fishing Department for June:

Inventory in Process 6-1,

1/3 completed     355 units

Transferred to finished goods

during June           4,540 units

Equivalent units of production

during June             4,868 equivalent units

Determine the number of equivalent units for conversion costs in the June 30 Finishing Department inventory, assuming that the first in first out method is used to cost inventories.

A. 446

B. 112

C. 4,450

D. 355

Please explain how you got the answer

Explanation / Answer

Answer : C. 4,450

=> Equivalent units:

Units Particulars Production units Material Conversion costs 355 Opening WIP 355 - 237 (2/3) 4513 Units introduced and completed 4185 4185 4185 Units transferred 4540 Closing WIP 328 328 - 4868 Equivalent Units 4868 4513 4422 nearest answer figure 4450

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