Question

Equivalent Units of Production

The following information concerns production in the Baking Department for March. All direct materials are placed in process at the beginning of production.

ACCOUNT Work in Process—Baking Department							ACCOUNT NO.
Date		Item	Debit		Credit		Balance
							Debit		Credit
March	1	Bal., 6,900 units, 4/5 completed					23,460
	31	Direct materials, 124,200 units	211,140				234,600
	31	Direct labor	55,350				289,950
	31	Factory overhead	31,128				321,078
	31	Goods finished, 126,000 units			310,266		10,812
	31	Bal. ? units, 3/5 completed					10,812

a. Determine the number of units in work in process inventory at March 31.
units

b. Determine the equivalent units of production for direct materials and conversion costs in March. If an amount is zero, enter in "0".

Baking Department
Equivalent Units of Production for Direct Materials and Conversion Costs
For March
	Whole Units	Direct Materials Equivalent Units	Conversion Equivalent Units
Inventory in process, March 1
Started and completed in March
Transferred to finished goods in March
Inventory in process, March 31
Total

Answer 1

Requirement a

Ending units 5,100

Working

Reconciliation of Units
A	Opening WIP	6,900
B	Introduced	124,200
C=A+B	TOTAL	131,100
D	Transferred	126,000
E=C-D	Closing WIP	5,100

Requirement b

Baking Department
Equivalent Units of Production for Direct Materials and Conversion Costs
For march
	Whole Units	Equivalent units Direct Material	Equivalent units Conversion cost
Inventory in process, March 1	6900	0	1,380
Started and completed in march	119100	119100	119100
Transferred to finished goods in march	126000	119100	120,480
Inventory in process march 31	5100	5100	3060
Total	131100	124200	123,540

Working

STEP 1 (FIFO)
Reconciliation of Units
	Units	% already completed		% completed this period
		Material	Conversion cost	Material	Conversion cost
Beginning WIP	6,900	100%	80%	0%	20%
Units introduced	124,200
Total units to be accounted for	131,100
Completed and Transferred unit	126,000	0%	0%	100%	100%
Ending WIP	5,100	0%	0%	100%	60%

.

STEP 2 (FIFO)
Equivalent Units
	Total Units	Material		Conversion cost
Units Transferred:		% completed this period	Equivalent Units	% completed this period	Equivalent Units
From WIP	6,900	0%	-	20%	1,380
From units started/Introduced	119,100	100%	119,100	100%	119,100
Total	126,000		119,100		120,480
	Total Units	Material		Conversion cost
Ending WIP		% completed this period	Equivalent Units	% completed this period	Equivalent Units
Total	5,100	100%	5,100	60%	3,060
Total EUP	131,100		124,200		123,540