The following data are available for a company's manufacturing activities:$\begin{array} { l c c }
\text { Beginning Work in Process inventory } & 5,000 \text { units } & 75 \% \text { completed as to } \
\text { Units started and completed } & 15,000& \text { conversion } \
\text { Ending Work in Process inventory } & 6,000 \text { units } & 50 \% \text { completed as to } \
&&\text { conversion }
\end{array}$
If materials are added when the production process begins and conversion costs are applied uniformly throughout the process, what are the equivalent units for direct materials and for conversion, respectively using the FIFO method of process costing?
A) 16,250 materials; 21,750 conversion.
B) 21,000 materials; 22,250 conversion.
C) 21,000 materials; 19,250 conversion.
D) 16,250 materials; 19,250 conversion .
E) 19,250 materials; 18,750 conversion.

Question

The following data are available for a company's manufacturing activities:$\begin{array} { l c c } 
\text { Beginning Work in Process inventory } & 5,000 \text { units } & 75 \% \text { completed as to } \
\text { Units started and completed } & 15,000& \text { conversion } \
\text { Ending Work in Process inventory } & 6,000 \text { units } & 50 \% \text { completed as to } \
&&\text { conversion }
\end{array}$
If materials are added when the production process begins and conversion costs are applied uniformly throughout the process, what are the equivalent units for direct materials and for conversion, respectively using the FIFO method of process costing?
A) 16,250 materials; 21,750 conversion.
B) 21,000 materials; 22,250 conversion.
C) 21,000 materials; 19,250 conversion.
D) 16,250 materials; 19,250 conversion .
E) 19,250 materials; 18,750 conversion.

Quizplus · Accepted Answer

Under FIFO, equivalent units for materials are the units started and completed plus the ending WIP, which is 15,000 + 6,000 = 21,000. For conversion, it is the work needed to complete the beginning WIP (5,000 units * 25%) plus the units started and completed (15,000) plus the work done on ending WIP (6,000 units * 50%), which totals 1,250 + 15,000 + 3,000 = 19,250.

The Following Data Are Available for a Company's Manufacturing Activities