Square Deal Company makes carpenter’s squares and uses a process costing system. There is no spoilage. Manufacturing goes through three departments: Forming, Finishing, and Packing. Unit data for these departments are given below:
$\begin{array}{lrrr}
&\text { Forming } & \text { Finishing } &\text { Packing }\
\text { Beginning inventory units } & & \
\quad(80 \% \text { complete) } & 1,000 & 2,000 & 3,000 \
\text { Units started } & 8,000 & ? & ? \
\text { Ending inventory units } & & & \
\quad(20 \% \text { complete) } & 3,000 & 4,000 & 1,000
\end{array}$
The Finishing Department adds materials at the point where processing is 50 percent complete.
-Refer to the figure.What are the equivalent units for transferred-in the Finishing Department? $$ \underline{\text { Weighted Average }} \quad \underline{ \text { FIFO }}$$

Question

Square Deal Company makes carpenter’s squares and uses a process costing system. There is no spoilage. Manufacturing goes through three departments: Forming, Finishing, and Packing. Unit data for these departments are given below:
$\begin{array}{lrrr}
&\text { Forming } & \text { Finishing } &\text { Packing }\
\text { Beginning inventory units } & & \
\quad(80 \% \text { complete) } & 1,000 & 2,000 & 3,000 \
\text { Units started } & 8,000 & ? & ? \
\text { Ending inventory units } & & & \
\quad(20 \% \text { complete) } & 3,000 & 4,000 & 1,000
\end{array}$
 The Finishing Department adds materials at the point where processing is 50 percent complete.
-Refer to the figure.What are the equivalent units for transferred-in the Finishing Department? $$ \underline{\text { Weighted Average }} \quad \underline{ \text { FIFO }}$$

Quizplus · Accepted Answer

In the Finishing Department, the equivalent units for transferred-in are the units completed and transferred out plus the equivalent units in ending inventory. Under the weighted average method, this is 8,000 units (2,000 completed from beginning inventory + 6,000 started and completed). Under FIFO, it is 6,000 units (only the units started and completed during the period).

Square Deal Company Makes Carpenter’s Squares and Uses a Process