Question

LALLIRATOR PRINTER VERSION BACK Brief Exercise 16-5 The Smelting Department of Kiner Company has the following production and cost data for November Production: Beginning work in process 3.900 units that are 100% complete as to materials and 29% complete as to conversion costs units transferred out 9,100 units and ending work in process 7.700 units that are 100% complete as to materials and 50% complete as to conversion costs. Compute the equivalent units of production for (a) materials and (b) conversion costs for the month of November Materials Conversion Costs Total equivalent units

Answer 1

Opening stock = 3900 units

Units transferred out = 9100 units

Hence, units introduced and completed in the current period = 9100 + 3900 -7700 = 5300 units

It has been assumed that the entity follows FIFO method

1. Material

Opening stock of 3900 units (already complete) = NIL

Units introduced and completed in the current period = 5300 units

Closing stock (100% complete as to materials) = 7700 units

Thus, Total Equivalent units = 13000 units

2. Conversion Cost

Opening Stock of 3900 units (29% complete, remaining 71% completed in the current period) = 2769 units

Units introduced and completed in the current period = 5300 units

Closing stock (50% complete as to conversion) = 7700 * 50% = 3850 units

Thus, Total Equivalent units = 11919 units