XYZ Company manufactures paint. One of its plants makes a light colored base that can be tinted at the retail store to match any color chosen by the customer. At the end of the current month, XYZ had 5,000 gallons of paint still in process. All of the ingredients had been added to the vats, but they still needed to be mixed and then poured into gallon containers. Each gallon was 75% of the way through the production process and conversion costs are incurred evenly throughout the process. What are the equivalent units of conversion costs in the ending work in process inventory?

Question

Quizplus · Accepted Answer

The equivalent units of conversion costs in the ending work in process inventory are calculated by taking the number of units in process (5,000 gallons) and multiplying by the percentage completion for conversion costs (75%). Therefore, 5,000 gallons * 75% = 3,750 equivalent units of conversion costs.

XYZ Company Manufactures Paint