Equivalent units may also be calculated using the first

Equivalent units may also be calculated using the first -...

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Equivalent units may also be calculated using the first-in, first-out (FIFO) method. Under the FIFO  method of calculating equivalent units, the beginning units would be identified separately from those  started and completed. Continuing with the previous example, if 700 units were in process and 40%  completed at the beginning of January, during January Department 1 would have added the 
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Unformatted text preview: additional 60% of the costs necessary to complete the units. Using the FIFO method, the equivalent units for January would be 3,060, calculated as follows: Actual Units % Completed during Month Equivalent Units Beginning units 700 60% 420 Started and completed 2,000 100% 2,000 Transferred out 2,700 2,420 Ending units 800 80% 640 Total 3,500 3,060...
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