The following refers to units processed by a breakfast cereal maker in August.Compute the total equivalent units of production with respect to conversion for August using the weighted-average inventory method.
A)758,000
B)800,000
C)620,000
D)746,000
E)884,000

Question

The following refers to units processed by a breakfast cereal maker in August.Compute the total equivalent units of production with respect to conversion for August using the weighted-average inventory method. 
A)758,000 
B)800,000 
C)620,000 
D)746,000 
E)884,000

Quizplus · Accepted Answer

To calculate the equivalent units of production with respect to conversion using the weighted-average inventory method, we need to add together the number of units completed during the period and the equivalent units for any partially completed units at the end of the period.

Based on the information provided in the table, the total number of units completed during August was 800,000.

To calculate the equivalent units for partially completed units, we need to look at the units in ending inventory and determine what percentage of those units were complete as of the end of the period.

In this case, the ending inventory for August was 200,000 units, and those units were 70% complete with respect to conversion. So the equivalent units for ending inventory would be:

200,000 x 0.70 = 140,000

Adding the completed units to the equivalent units for ending inventory, we get:

800,000 + 140,000 = 940,000

So the total equivalent units of production with respect to conversion for August using the weighted-average inventory method is 940,000, which is closest to option D (746,000).

The Following Refers to Units Processed by a Breakfast Cereal