Question

The following information concerns production in the Baking Department for March. All direct materials are placed in process at the beginning of production.

ACCOUNT Work in Process—Baking Department							ACCOUNT NO.
Date		Item	Debit		Credit		Balance
							Debit		Credit
March	1	Bal., 7,500 units, 2/5 completed					21,000
	31	Direct materials, 135,000 units	189,000				210,000
	31	Direct labor	52,250				262,250
	31	Factory overhead	29,398				291,648
	31	Goods finished, 136,800 units			282,300		9,348
	31	Bal. ? units, 2/5 completed					9,348

a. Determine the number of units in work in process inventory at March 31.
units

b. Determine the equivalent units of production for direct materials and conversion costs in March. If an amount is zero, enter in "0".

Baking Department
Equivalent Units of Production for Direct Materials and Conversion Costs
For March
	Whole Units	Direct Materials Equivalent Units	Conversion Equivalent Units
Inventory in process, March 1
Started and completed in March
Transferred to finished goods in March
Inventory in process, March 31
Total

Answer 1

• No of units in WIP = 7500 units + 135000 units – 136800 units
  = 5700 units
• Requirement [b]

Baking Department
Equivalent Units of Production for Direct Materials and Conversion Costs
For March
	Whole Units	Direct Materials	Conversion Equivalent Units
		Equivalent Units
Inventory in process, Dec 1	7,500	-	4,500 [7500 x 3/5]
Started and completed in March	129,300	129,300	129,300
Transferred to finished goods in March	136,800	129,300	133,800
Inventory in process, Dec 31	5,700	5,700	2,280 [5700 x 2/5]
Total	142,500	135,000	136,080