At the start of the month, Oak Inc. had 58,000 units of beginning work in process...

At the start of the month, Oak Inc. had 58,000 units of beginning work in process that were 65% complete. Over the course of the month, the firm completed and transferred out 208,900 units, and at the end of the month, it had 59,400 units in ending work in process that were 70% complete. In comparison, Maple Inc. began the month with 61,200 units of beginning work in process that were 60% complete. Over the course of the month, the firm completed and transferred out 210,500 units, and at the end of the month, it had 52,400 units in ending work in process that were 90% complete. Both firms add 40% of materials at the beginning of the process and the remaining 60% when the units are 70% complete. Both firms also add 25% of conversion costs at the beginning of the process and the remaining 75% when the units are 90% complete. According to these figures, Oak has ________ equivalent units of production for materials and ________ equivalent units of production for conversion costs than Maple.

a. more ; fewer

b. fewer; fewer

c. fewer; more

d. more; more

can someone explain this question for me?

Expert Solution

Answer is a. More; Fewer.

Explanation:

OAK INC
Equivalent Units:
	TOTAL	Material Cost		Conversion
	UNITS	% Completion	Units	% Completion	Units
Units completed from Beg. WIP	58000	60%	34,800	75%	43,500
Units started and completed	150900	100%	150,900	100%	150,900
Ending Work in Process	59400	100%	59,400	25%	14,850
Total Equivalent units	268300		245,100		209,250


MAPLE INC
Equivalent Units:
	TOTAL	Material Cost		Conversion
	UNITS	% Completion	Units	% Completion	Units
Units completed from Beg. WIP	61200	60%	36,720	75%	45,900
Units started and completed	149300	100%	149,300	100%	149,300
Ending Work in Process	52400	100%	52,400	100%	52,400
Total Equivalent units	262900		238,420		247,600

Nte: ending WIP is 90% complete, this means Conversion cost is applied fully on ending WIP as well.

ekkarill92 answered 2 years ago

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