Question

A production department in a process manufacturing system completed its work on 92,000 units of product and transferred them to the next department during a recent period. Of these units, 27,600 were in process at the beginning of the period. The other 64,400 units were started and completed during the period. At period-end, 16,600 units were in process.

Prepare the production department’s equivalent units of production for direct materials under each of three separate assumptions using the weighted-average method for process costing.

Equivalent Units of Production (EUP)-Weighted Average Method 1. All direct materials are added to products when processing begins. Units % Materials EUP-Materials Total 2. Beginning inventory is 40% complete as to materials and conversion costs. Ending inventory is 80% complete as to materials and conversion costs. % Materials Units EUP-Materials Total

Answer 1

1) Equivalent unit

	Units	% materials	EUP-material
Unit transferred out	92000	100%	92000
Ending WIP	16600	100%	16600
Total			108600

2) Equivalent unit

	Units	% materials	EUP-material
Unit transferred out	92000	100%	92000
Ending WIP	16600	80%	13280
Total			105280

3) Equivalent unit

	Units	% materials	EUP-material
Unit transferred out	92000	100%	92000
Ending WIP	16600	30%	4980
Total			96980