In the month of June, a department had 20,000 units in beginning work in process that were 70%...

Question:

In the month of June, a department had 20,000 units in beginning work in process that were 70% complete. During June, 90,000 units were transferred into production from another department. At the end of June, there were 10,000 units in ending work in process that were 40% complete. Materials are added at the beginning of the process, while conversion costs are incurred uniformly throughout the process.

Determine June's equivalent units of production for materials.

Equivalent Units of Production:

The number of equivalent units of production is used in process costing to allocate the total manufacturing costs of a production department between the units transferred out and those remaining in the process. This cost allocation is usually done separately from direct materials costs and conversion costs.

Answer and Explanation: 1

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Note that direct materials are added at the beginning of the process, so the units that are transferred in are 100% complete with regards to direct...

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Equivalent Units & the Weighted-Average Method Formula

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Chapter 6 / Lesson 2
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Learn about equivalent units of production in economics and business with examples. Discover how equivalent units are calculated and analyzed by economists.


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