BUS 121 - Managerial Accounting Chapter 4 – Handout #2 Solution Process Costing – Calculation of Equivalent Units Calculation of Equivalent Units, Two Methods: Using the following data, figure the number of equivalent units for material and conversion costs, first using the weighted average method and then the FIFO method: ( Note: For the FIFO method, please complete the 3-step format as shown on p. 165 of your text; if you wish to use the alternative format on p. 166, top of page, add that one as a second schedule.) Beginning WIP Inventory 25,000 units, 80% complete with respect to materials, and 40% complete with respect to conversion costs. Added to production, units started 195,000 units Completed and transferred 180,000 units Ending WIP Inventory 40,000 units, 75% complete with respect to materials, and 60% complete with respect to conversion costs. 1. Weighted Average Method: Materials
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