The following data are available for a company's manufacturing activities: If materials are added when the production process begins and direct labor is applied uniformly throughout the process, what are the equivalent units for direct materials and for direct labor, respectively using the FIFO method of process costing?
A) 16,250; 19,250.
B) 16,250; 21,750.
C) 21,000; 19,250.
D) 19,250; 18,750.
E) 21,000; 22,250.

Question

Quizplus · Accepted Answer

Under FIFO, equivalent units for direct materials are calculated based on the units started and completed during the period plus the ending inventory. For direct labor, it considers the work done on beginning inventory, units started and completed, and ending inventory.

The Following Data Are Available for a Company's Manufacturing Activities