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Q.18-8SE

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Horngren'S Financial And Managerial Accounting
Found in: Page 1008

Short Answer

Question: The Mixing Department of Complete Foods had 62,000 units to account for in October. Of the 62,000 units, 38,000 units were completed and transferred to the next department, and 24,000 units were 20% complete. All of the materials are added at the beginning of the process. Conversion costs are added evenly throughout the mixing process and the company uses the weighted-average method.

Compute the total equivalent units of production for direct materials and

conversion costs for October.

Answer

Particulars

Physical Units

Direct materials

Conversion cost

Units accounted for

Completed and transferred out

38,000

38,000

38,000

Ending WIP

24,000

24,000

4,800

Total units accounted for

62,000

62,000

42,800

See the step by step solution

Step by Step Solution

Step 1: Equivalent unit of production for direct material

Particulars

Units

Completion %

EUP

Completed units

38,000

100%

38,000

In process units

24,000

100%

24,000

Total equivalent unit of production for direct material

62,000

Step 2: Equivalent unit of production for conversion cost

Particulars

Units

Completion %

EUP

Completed units

38,000

100%

38,000

In process units

24,000

20%

4,800

Total equivalent unit of production for conversion cost42,800

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