The production department in a process manufacturing system completed 94,000 units of product and transferred them to finished goods during a recent period. Of these units, 28,200 were in process at the beginning of the period. The other 65,800 units were started and completed during the period. At period-end, 16,700 units were in process. Compute the departments equivalent units of production with repect to direct materials under each of three seperate assumptions, using the weighted average method, then using the FIFO method a. All direct materials are added to products when processing begins.
b. Beginning inventory is 40% complete to materials and conversion costs. Ending inventory is 75% complete as to materials and conversion costs
c. Beginning inventory is 60% complete as to materials and 40% complete as to conversion costs. Ending Inventory is 30% complete as to materials and 60% complete to conversion costs.

Weighted Average Method.

a. 110,700 units

b.  106,525 units

c.  82,090 units

FIFO

a. 85,500 units

b.  95,245 units

c.  99,010 units

Explanation:

Calculation of equivalent units of production with respect to direct materials.

FIFO.

a. All direct materials are added to products when processing begins.

Materials

To finish Opening Work in Process                    0

Started and Completed                                  65,800

Closing Work in process (16,700 × 100%)       16,700

Total  equivalent units of production             85,500

b. Beginning inventory is 40% complete to materials and conversion costs. Ending inventory is 75% complete as to materials and conversion costs

Materials

To finish Opening Work in Process  (28,200 × 60%) 16,920

Started and Completed (65,800 × 100%)                   65,800

Closing Work in process (16,700 × 75%)                     12,525

Total  equivalent units of production                          95,245

c. Beginning inventory is 60% complete as to materials and 40% complete as to conversion costs. Ending Inventory is 30% complete as to materials and 60% complete to conversion costs.

Materials

To finish Opening Work in Process  (28,200 × 40%)  11,280

Started and Completed (65,800 × 100%)                   65,800

Closing Work in process (16,700 × 30%)                       5,010

Total  equivalent units of production                         82,090

Weighted Average Method.

a. All direct materials are added to products when processing begins.

Materials

Completed and transferred (94,000 × 100%) 94,000

Closing Work in process (16,700 × 100%)        16,700

Total  equivalent units of production              110,700

b. Beginning inventory is 40% complete to materials and conversion costs. Ending inventory is 75% complete as to materials and conversion costs

Materials

Completed and transferred (94,000 × 100%)            94,000

Closing Work in process (16,700 × 75%)                     12,525

Total  equivalent units of production                        106,525

c. Beginning inventory is 60% complete as to materials and 40% complete as to conversion costs. Ending Inventory is 30% complete as to materials and 60% complete to conversion costs.

Materials

Completed and transferred (94,000 × 100%)            94,000

Closing Work in process (16,700 × 30%)                       5,010

Total  equivalent units of production                          99,010

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