Montgomery Company makes fabric-covered hatboxes.The company began July with 500 boxes in process that were 100 percent complete as to cardboard,80 percent complete as to cloth,and 60 percent complete as to conversion costs.During the month,3,300 boxes were started.On April 30,350 boxes were in process (100 percent complete as to cardboard,70 percent complete as to cloth,and 55 percent complete as to conversion costs).Using the FIFO method,what are equivalent units for cloth?

Question

Quizplus · Accepted Answer

The equivalent units for cloth using FIFO are calculated by considering the work done during the period. Starting with 3,300 boxes started and 350 in ending inventory, we calculate: 3,300 - 500 (beginning inventory) + (350 * 70%) = 3,295 equivalent units for cloth.

Montgomery Company Makes Fabric-Covered Hatboxes