Equivalent Units of Conversion Costs cs Company had 4,000 ounces in begnning wor

Question

Equivalent Units of Conversion Costs cs Company had 4,000 ounces in begnning work in process inventory 60% complete·During the pened, 46,000 ounces were completed. The ending work in process inventory was 8,000 ounces (25% complete). What are the total equivalent units for conversion costs? If required, round to the nearest unit 50,400 X units Feedback Are you determining the equivalent units of materials added or of conversion of materials? When would materials typically be added in the process? When would conversion of these materials take place? Recall the definition of work in process.

Explanation / Answer

It is assumed that the company is using the Weighted average method Step 1: Summarize the Flow of Physical units of output. The physical units column shows - 4000 units from beginning inventory and 50000 (8000+46000-4000) units started during the current month and the units went – 46000 units completed and transferred out and 8000 units in ending inventory. Step 2: Compute the Output in terms of Equivalent units. (Step 1) (Step 2) Equivalent units Flow of production Physical units Conversion costs Wok-in-process, beginning (given) 4000 Started during current period (given) 50000 To account for 54000 Completed and transferred out during the current period 46000 46000 Wok-in-process, ending (given) 8000 (8000*25%) 2000 Accounted for 54000 Equivalent units of work done to date 48000 Degree of completion in this department: direct materials, 100%; conversion costs, 25%

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