Harlow Corp.uses a FIFO process costing system.Beginning inventory for January consisted of 1,000 units that were 60% completed.During January,9,500 units were started and completed.On January 31,the inventory consisted of 500 units that were 70% completed.How many units were started during January?
A)9,850
B)10,000
C)10,250
D)11,000

Question

Quizplus · Accepted Answer

To find the number of units started during January, we need to calculate the total units accounted for and subtract the beginning inventory and the units in ending inventory that were part of the work done in January. The total units accounted for equals the units completed during January plus the ending inventory. Given that 9,500 units were started and completed, and the ending inventory consists of 500 units, the total units accounted for would be 9,500 (completed) + 500 (ending inventory) = 10,000. Since the beginning inventory was already in process (and not started in January), it is not added to the units started in January. Therefore, 10,000 units were started during January.