In Shady Company, materials are entered at the beginning of each process. Work i

Question

In Shady Company, materials are entered at the beginning of each process. Work in process inventories, with the percentage of work done on conversion costs, and production data for its Sterilizing Department in selected months during 2017 are as follows. Beginning Work in Process Ending Work in Process Month Units Conversion Cost% Units Transferred Out Units Conversion Cost% January -0- — 11,000 2,000 60 March -0- — 12,000 3,000 30 May -0- — 14,000 7,000 80 July -0- — 10,000 1,500 40 Instructions (a) Compute the physical units for January and May. (b) Compute the equivalent units of production for (1) materials and (2) conversion costs for each month.

Explanation / Answer

(a) Compute the physical units for January and May January May Units to be accounted for Beginning work in process             -                         -   Started into production       13,000                 21,000 Total units       13,000                 21,000 Units accounted for Transferred out       11,000                 14,000 Ending work in process         2,000                  7,000 Total units       13,000                 21,000 (b) Compute the equivalent units of production for (1) materials and (2) conversion costs for each month Materials Conversion Costs January 13000 12200 March 15000 12900 May 21000 19600 July 11500 10600

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