Anzalone Corporation adds raw materials to production at the beginning of the process in the Assembly...

Anzalone Corporation adds raw materials to production at the beginning of the process in the Assembly Department. Materials data for this department for May 2018 are as follows:

		Costs
	Units	Materials	Conversion
Work in process, May 1	25,000	$ 68,750	$167,650
Started during May	100,000	300,000	903,350
Work in process, May 31	10,000

Beginning inventory was 70 percent complete. Ending inventory was 40 percent complete.
How many equivalent units for materials would there be for Anzalone Corporation in May using the FIFO method?

a.100,000 units

b.119,000 units

c.110,000 units

d.125,000 units

Please explain how to solve for each number, thank you!

Solutions

Expert Solution

Option - A: 100,000 units

Since, Raw Material is introduced at the beginning of the process, which means no Material is required to be added during the Process.

Hence, No material is required for completion of the processing of the Opening of the Work In Process.

The units introduced during the year completely utilizes the material at the time of introduction into the process.

Therefore Equivalent units for Material is equal to the units introduced during the period i.e. 100,000 units

Particulars	Material
Units	% of Completion	Equivalent Units
Opening WIP, Processed	25,000	0%	-
Units Completed & Transferred	90,000	100%	90,000
Closing WIP, Processed	10,000	100%	10,000
Equivalent units of Production			1,00,000

ekkarill92 answered 2 years ago

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