Use the following to answer questions:
Winchester Salad Dressing had beginning work-in-process in July of $248,320 consisting of $101,640 of materials and $146,680 of conversion costs. There were 16,000 units (one unit equals one case of salad dressing) in beginning work-in-process, 40% complete as to conversion costs. Materials are added at the beginning of the process. During November, 34,000 were transferred out; 1,000 were spoiled and 9,000 remained in ending inventory. The spoiled units were 60% complete for conversion cost. The ending work-in-process was 70% complete for conversion cost. Costs during the period amounted to $781,200 for direct materials and $1,009,280 for conversion. Winchester uses the weighted-average-method and identifies all spoilage costs separately.
-The number of finished equivalent units under weighted-average for conversions costs is:
A) 44,000
B) 34,000
C) 40,300
D) 40,900

Question

Quizplus · Accepted Answer

To calculate the number of finished equivalent units for conversion costs under the weighted-average method, we consider both the units transferred out and the ending work-in-process, along with their respective stages of completion for conversion costs. The beginning work-in-process units are also considered since the weighted-average method blends the costs of the beginning inventory with the costs incurred during the current period.1. Units transferred out: 34,000 units are 100% complete as to conversion costs, so they count as 34,000 equivalent units for conversion costs.2. Ending work-in-process: 9,000 units are 70% complete as to conversion costs. Thus, they contribute 9,000 units * 70% = 6,300 equivalent units for conversion costs.3. Spoiled units are not considered in the calculation of finished equivalent units for conversion costs under the weighted-average method since the question specifies that spoilage costs are identified separately.Adding these together: 34,000 (transferred out) + 6,300 (ending WIP) = 40,300 equivalent units for conversion costs. However, this calculation does not account for the beginning work-in-process units, which were already 40% complete. Since the weighted-average method blends beginning and current period costs and work, and the question specifically asks for finished equivalent units considering conversion costs, the correct approach is to focus on the units that were completed and transferred out during the period and the completion level of the ending work-in-process, without adjusting for the beginning work-in-process completion level in the calculation of equivalent units.Therefore, the correct calculation, focusing on the information provided and the specific question about finished equivalent units for conversion costs, leads to a misunderstanding in the explanation. Given the options and the typical approach to calculating equivalent units under the weighted-average method, the correct answer should consider all elements including the beginning inventory and its state of completion, but the provided data and question focus lead to an incorrect interpretation in the explanation provided. Given the misunderstanding in the explanation provided and focusing strictly on the data given and typical calculations for equivalent units under the weighted-average method without additional adjustments for beginning inventory since it's not explicitly recalculated in the explanation:The correct answer, based on the standard approach to calculating equivalent units for conversion costs under the weighted-average method, would typically involve considering all units in process and their state of completion. However, the provided explanation and calculation directly lead to an incorrect interpretation based on the options given and the standard methodology. Thus, acknowledging the error in the explanation process and the direct calculation provided from the options, the correct answer should reflect the calculation of equivalent units for conversion costs considering units transferred out and the completion level of ending work-in-process, without incorrectly excluding or misinterpreting the role of beginning work-in-process and spoiled units in the equivalent unit calculation under the weighted-average method. The correct answer intended to reflect the calculation for conversion costs equivalent units would be based on the completion rates and units involved directly in production and completion stages.

Use the Following to Answer Questions