Question

In Shady Company, materials are entered at the beginning of each process. Work in process inventories, with the percentage of work done on conversion costs, and production data for its Sterilizing Department in selected months during 2020 are as follows. Ending Work in Process Beginning Work in Process Conversion Units Cost% Units Transferred Out Month Units Conversion Cost% January March May July 11,800 13,600 15,700 10,500 2,400 4,500 7,360 2,200 Compute the physical units for January and May. January May Units to be accounted for Beginning work in process Started into production Total units Units accounted for Transferred out Ending work in process Total units Compute the equivalent units of production for (1) materials and (2) conversion costs for each month. Materials Conversion Costs January March May July

Answer 1

	January	May
Units to be accounted for:
Beginning work in process	0	0
Started into production	14,200 (11,800+2,400)	23,060 (15,700+7,360)
Total units	14,200	23,060
Units accounted for:
Transferred out	11,800	15,700
Ending work in process	2,400	7,360
Total units	14,200	23,060

	Material	Conversion costs
January	14,200	13,408 (11,800+2,400*67%)
March	18,100 (13,600+4,500)	15,220 (13,600*4,500*36%)
May	23,060	21,588 (15,700+7,360*80%)
July	12,700 (10,500+2,200)	11,468 (10,500+2,200*44%)