1. Dewey Company produces plastic cups in a one-department process. The followin
ID: 2535935 • Letter: 1
Question
1.Dewey Company produces plastic cups in a one-department process. The following data is available for the past month:
Work-in-process inventory, beginning 0
Units started 60,000
Units completed and transferred 50,000
Work-in-process inventory, ending 10,000
The units in process at the end of the month are 100 percent complete with respect to materials and 75 percent complete with respect to conversion costs. What are the equivalent units for conversion costs for the month?
A) 12,000
B) 30,000
C) 54,000
D) 57,500
Explanation / Answer
THERE IS NO OPENING WORK IN PROGRESS
UNITS STARTED ARE 60000 OUT OF WHICH 50000 UNITS WERE COMPLETED AND TRANSFERRED
ENDING WORK IN PROGRESS IS 10000 100% COMPLETE AS TO MATERIALS AND 75% COMPLETE AS TO CONVERSION COST
TOTAL EQUIVALENT UNITS FOR CONVERSION COT IS
UNITS COMPLETED AND TRANSFERRED IS 50000 UNITS
10000 UNITS WORK IN PROGRESS 75% COMPLETE AS TO CONVRSION COST
THEREFORE EQUIVALENTS UNITS ARE (10000*75%) = 7500 UNITS
TOTAL EQUIVALENT UNITS FOR CONVERSION COST IS = 57500 UNITS
OPTION 'D' IS CORRECT
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