Question

 

Department W had 2,940 units, one-third completed at the beginning of the period. 13,400 units were transferred to Department X from Department W during the period, and 900 units were one-half completed at the end of the period. Assume the completion ratios apply to direct materials and conversion costs.

Determine the equivalent units of production used to compute the unit conversion cost on the cost of production report for Department W. Assume the company uses FIFO.

a.12,870 units

b.10,460 units

c.17,240 units

d.12,420 units

Answer 1

 

Correct answer------------a.12,870 units

Working

STEP 1 (FIFO)
Reconciliation of Units
	Units	% already completed		% completed this period
		Material	Conversion	Material	Conversion
Beginning WIP	2,940	100%	33%	0%	67%
Units introduced	11,360
Total units to be accounted for	14,300
Completed and Transferred unit	13,400	0%	0%	100%	100%
Ending WIP	900	0%	0%	100%	50%

.

STEP 2 (FIFO)
Equivalent Units
	Total Units	Material		Conversion
Units Transferred:		% completed this period	Equivalent Units	% completed this period	Equivalent Units
From WIP	2,940	0%	-	67%	1,960
From units started/Introduced	10,460	100%	10,460	100%	10,460
Total	13,400		10,460		12,420
	Total Units	Material		Conversion
Ending WIP		% completed this period	Equivalent Units	% completed this period	Equivalent Units
Total	900	100%	900	50%	450
Total EUP	14,300		11,360		12,870

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