The Assembly Department of Smart Inc.,a manufacturer of computers,had a beginning inventory of 5,000 units.During November,it assembled 2,000 units and transferred them to the Packaging Department.It incurred $250,000 in direct materials and $75,000 in conversion costs.The ending inventory in November was 3,000 units which were 100% and 60% complete with respect to materials and conversion costs,respectively.Calculate the total equivalent units of production for conversion costs for November.

Question

Quizplus · Accepted Answer

The total equivalent units of production for conversion costs can be calculated as the sum of equivalent units of production for units completed and ending work in process. 
Units completed = 2,000 
Equivalent units of production for ending WIP = 3,000 x 60% = 1,800 
Total equivalent units of production = 2,000 + 1,800 = 3,800, which corresponds to option C.