Question

Clonex Labs, Inc., uses the weighted-average method in its process costing system. The following data are available for one department for October:

		Percent Completed
	Units	Materials		Conversion
Work in process, October 1	34,000	58	%	25	%
Work in process, October 31	15,000	83	%	44	%

The department started 167,000 units into production during the month and transferred 186,000 completed units to the next department.

Required:

Assuming the company uses the FIFO method, compute the equivalent units of production for materials and conversion for October.

Answer 1

Solution

	Material	Conversion
Equivalent Units of Production	178,730	184,100

Working

STEP 1 (FIFO)
Reconciliation of Units
	Units	% already completed		% completed this period
		Material	Conversion cost	Material	Conversion cost
Beginning WIP	34,000	58%	25%	42%	75%
Units introduced	167,000
Total units to be accounted for	201,000
Completed and Transferred unit	186,000	0%	0%	100%	100%
Ending WIP	15,000	0%	0%	83%	44%

.

STEP 2 (FIFO)
Equivalent Units
	Total Units	Material		Conversion cost
Units Transferred:		% completed this period	Equivalent Units	% completed this period	Equivalent Units
From WIP	34,000	42%	14,280	75%	25,500
From units started/Introduced	152,000	100%	152,000	100%	152,000
Total	186,000		166,280		177,500
	Total Units	Material		Conversion cost
Ending WIP		% completed this period	Equivalent Units	% completed this period	Equivalent Units
Total	15,000	83%	12,450	44%	6,600
Total EUP	201,000		178,730		184,100