Equivalent Units of Production: Average Cost Metho data for the two departments
ID: 390337 • Letter: E
Question
Equivalent Units of Production: Average Cost Metho data for the two departments of Atiantic Cable and Wire Company for July of the current fiscal year are as follows Drawing Department 1,900 units, 5596 completed 30,400 units Winding Department 600 units, 30% completecd 29,650 units Work in process, July 1 during July Work in process, July 31 Each department uses the average cost method. a. Determine the number of whole units to be accounted for and to be assigned costs and the equivalent units of production for the Drawing Department 1,400 units, 60% completed 1,000 units, 35% completecd Whole units units units Equivalent units of production b. Determine the number of whole units to be accounted for and to be assigned costs and the equivalent units of production for the Winding Department Whole units units units Equivalent units of productionExplanation / Answer
a. The drawing department
Work in process, July 1 1,900 units (55% completed)
Competed and transferred to next processing department during July 30,400 units
Work in process, July 31 1,400 units (60% completed)
Whole units to be accounted for and be assigned costs for the drawing department
= Competed and transferred to next processing department during July + Work in process, July 31
= 30,400 units +1,400 units
= 31,800 units
The number of equivalent units of production
Equivalent Units of Production = Units completed and transferred to next processing department during July + (Units in work in process on July 31 * percent complete)
= 30,400 units +1,400 units *60%
= 30,400 units +840 units
= 31,240 units
b. The winding department
Work in process, July 1 600 units (30% completed)
Competed and transferred to next processing department during July 29,650 units
Work in process, July 31 1,000 units (35% completed)
Whole units to be accounted for and be assigned costs for the winding department
= Competed and transferred to next processing department during July + Work in process, July 31
= 29,650 units +1,000 units
= 30,650 units
The number of equivalent units of production
Equivalent Units of Production = Units completed and transferred to next processing department during July + (Units in work in process on July 31 * percent complete)
= 29,650 units +1,000 units *35%
= 29,650 units + 350 units
= 30,000 units
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