Garcia Company manufactures phones in a two-department process that includes Assembly and Finishing.Information about the Assembly Department follows:
$\begin{array}{ll}
\text { Direct materials added } & \$ 310,000 \
\text { Direct labor } & 460,000 \
\text { Factory overhead } & 230,000\
\text { Total costs to account for }&\$1,000,000
\end{array}$
There was no beginning inventory and 80,000 units were started in the Assembly Department.By the end of the month,67,200 units were completed and transferred to the Finishing Department and 12,800 units were still in process.The partially complete units were 100 percent complete with regard to direct materials but 80 percent complete with regard to conversion costs.The equivalent units for conversion costs for the month for the Assembly Department are ________.

Question

Quizplus · Accepted Answer

The equivalent units for conversion costs are calculated by adding the units completed and transferred out (67,200 units) to the equivalent units for the work in process. The work in process units (12,800) were 80% complete for conversion costs, so the equivalent units for these are 12,800 * 0.8 = 10,240. Adding these to the completed units gives 67,200 + 10,240 = 77,440 equivalent units for conversion costs.

Garcia Company Manufactures Phones in a Two-Department Process That Includes