Use the information below to answer the following questions:
The Adams Company uses a process costing system. During the current period, 1,600 units were started and 1,200 units were completed and transferred out. Ending units were 70% complete for materials and 35% complete for conversion costs. Direct materials costs added were $32,500 and conversion costs added were $31,400. There was no beginning WIP inventory and conversion costs are added evenly throughout the process.
-At the end of the period, what are the total equivalent units for direct materials for the Adams Company?

Question

Quizplus · Accepted Answer

The total equivalent units for direct materials are calculated by adding the units completed and transferred out (1,200) to the equivalent units in ending WIP (400 units * 70% complete = 280). Therefore, 1,200 + 280 = 1,480 equivalent units.

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