Assume that 12,000 units, 60% complete were in the beginning work in process, 50,000 units were started during the period, 6,000 units, 30% complete were in the ending work in process. Direct materials are added at the beginning of the process and conversion costs are incurred evenly throughout the process.
- Assuming the company uses the weighted-average method, what are the equivalent units of production for conversion costs?

Question

Quizplus · Accepted Answer

The equivalent units of production for conversion costs can be calculated as follows: Beginning work in process units (12,000) at 60% completion + Units started and completed during the period (50,000 - 6,000) + Ending work in process units (6,000) at 30% completion = (12,000 * 0.6) + (44,000) + (6,000 * 0.3) = 7,200 + 44,000 + 1,800 = 53,000 equivalent units for conversion costs. However, the correct calculation should include the full units started and completed or transferred out, plus the equivalent units for the beginning and ending work in process. The correct formula is: (Units completed and transferred out + Ending WIP * % completion of ending WIP) + (Beginning WIP * % completion of beginning WIP). Given the mistake in the initial calculation, the correct answer based on the provided options and the correct approach to calculating equivalent units for conversion costs would be different from the options given.

Assume That 12,000 Units, 60% Complete Were in the Beginning