In: Accounting
Comfort chair company manufactures a standard recliner and uses the FIFO method. In the Assembly Department (the first department in the production process), the company has two cost categories: direct materials and conversion costs. Direct materials are added at the beginning of the assembly process. Conversion costs are allocated evenly throughout the assembly process. Swivel Chair’s Assembly Department started the month of February with 25,000 units in process that were 50% converted. During the month, 80,000 units were started in the Assembly Department. 20,000 units were partially completed (50% converted) at the end of February.
QUESTION: Determine the total equivalent units of work done in the Assembly Department in February with respect to direct materials.