Fish Company manufactures phones in a two-department process: Assembly and Finishing.Information on the Assembly department follows: $\begin{array}{lr}
\text { Direct materi als added } & \$ 336,000 \
\text { Direct labor } & 460,000 \
\text { Factory overhead } & 230,000\
\text { Total costs to account for}&\$ 1,026,000
\end{array}$ There was no beginning inventory, and of the 80,000 units started in production 67,200 were completed and transferred to the Finishing department, while 12,800 units were still in process.These units had all materials added but were only 80% complete as far as conversion costs.The equivalent units for conversion costs are _____.
A)80,000
B)67,200
C)77,440
D)12,800

Question

Quizplus · Accepted Answer

The equivalent units for conversion costs are calculated by adding the units completed and transferred out (which are 100% complete for conversion costs) to the equivalent units for the work done on the units still in process. The units still in process are 80% complete for conversion costs. Therefore, the calculation is $67,200 + (12,800 \times 0.80) = 67,200 + 10,240 = 77,440$.

Fish Company Manufactures Phones in a Two-Department Process: Assembly and Finishing.Information