Quality Tea manufacturing company has given the following details for a particular process: During the month of June, 1,600 units were already in process, and another 10,000 units were started. At the end of the period, 8,600 units were completed. All of the Direct Materials (DM) are added at the beginning of the process; however, Conversion Costs (CC) are added evenly throughout the process. Quality follows the Weighted-Average method of inventory valuation. Ending Work-in-Progress (WIP) Inventory was two-thirds complete with respect to Conversion Costs. Find equivalent units in the ending WIP Inventory with respect to Conversion Costs. (Round units to whole number.)

Question

Quizplus · Accepted Answer

Units in Ending WIP Inventory = Units Already in Process at the Beginning + Units Started During the Period - Units Completed in the Period
Therefore, Ending WIP Inventory Units = 1,600 units + 10,000 units - 8,600 units = 3,000 units
Equivalent Units in Ending WIP Inventory with Respect to Conversion Costs = Units in Ending WIP Inventory × Percentage Completed During the Period = 3,000 units × 66.67% (two-thirds) = 2,000.10 or 2,000 units

Quality Tea Manufacturing Company Has Given the Following Details for a Particular