Question

Brief Exercise 17-5 The Smelting Department of Kiner Company has the following production and cost data for November. Production: Beginning work in process 3,700 units that are 100% complete as to materials and 29% complete as to conversion costs; units transferred out 9,300 units; and ending work in process 9,100 units that are 100% complete as to materials and 40% 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

Solution: Using FIFO METHOD:

Equivalent unit of production for material = Units from Beg. WIP + units started & completed + Units of ending WIP

= 3,700(100-100)% + (9300- 3,700) + 9,100*100% = 14,700 units

Equivalent units of production for conversion cost = 3,700×(100-29)% + (9,300-3,700) + 9,100×40% = 11,867 units

Using Weighted average method:

units No. of equivalent units Direct material Conversion Units % Units 100% 9,300 100% 9,300 Completed & transferred 9,300 Ending WIP 100% 40% 9,100 18,400 9,100 18,400 Total 3,640 12,940

Equivalent units (materials) = 18,400 units

Equivalent units (conversion cost) = 12,940 units