Irvin Corporation’s Mixing Department began January 2011 with 10,000 gallons of product (40 percent completed) in process. During January, Irvin started 100,000 gallons of new product, of which 15,000 gallons remained in ending inventory (70 percent completed).
-Refer to the figure.If materials were added when the units were 80 percent complete,how many equivalent units of production for materials would there be for Irvin using the weighted average costing method?

Question

Quizplus · Accepted Answer

Under the weighted average method, equivalent units for materials are calculated based on the units completed and transferred out plus the equivalent units in ending inventory. Since materials are added when units are 80% complete, only the units completed and transferred out are considered for materials. Therefore, the equivalent units for materials are 95,000 (100,000 started - 15,000 ending inventory).

Irvin Corporation’s Mixing Department Began January 2011 with 10,000 Gallons