Use the following information for the next 10 questions.
Zuniga, Inc. uses a process costing system. During May, 1,200 units were transferred into Department 2 at a cost of $38,040. Direct materials are added at the beginning of the process. Additionally:
-Using the FIFO method, the equivalent units of material were
A) 1,200
B) 1,100
C) 850
D) 1,450

Question

Use the following information for the next 10 questions.
Zuniga, Inc. uses a process costing system. During May, 1,200 units were transferred into Department 2 at a cost of $38,040. Direct materials are added at the beginning of the process. Additionally: 
-Using the FIFO method, the equivalent units of material were
A) 1,200 
B) 1,100 
C) 850 
D) 1,450

Quizplus · Accepted Answer

The FIFO method calculates equivalent units based on work done during the current period. If the problem context indicates that 1,200 units were completed and transferred out, and no additional information suggests otherwise, then 1,200 is the correct number of equivalent units for materials.

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