(Appendix 4A)Winder Company uses the FIFO method in its process costing system.Department One is the first stage of the company's production process.The following information pertains to conversion costs for April for Department One: What are the equivalent units of production for conversion costs?
A) 320,000 units.
B) 336,000 units.
C) 352,000 units.
D) 360,000 units.

Question

Quizplus · Accepted Answer

The equivalent units of production for conversion costs are calculated as follows:
Equivalent units of production = Units completed and transferred out + (Ending work in process inventory × Percentage of completion)
Units completed and transferred out = 280,000 units
Ending work in process inventory = 40,000 units × 80% = 32,000 units
Equivalent units of production = 280,000 + (32,000 × 100%) = 312,000 units
Therefore, the equivalent units of production for conversion costs for Department One in April is 336,000 units.

(Appendix 4A)Winder Company Uses the FIFO Method in Its Process