Question

Equivalent Units of Materials Cost

The Rolling Department of Kraus Steel Company had 4,100 tons in beginning work in process inventory (70% complete) on October 1. During October, 68,600 tons were completed. The ending work in process inventory on October 31 was 3,400 tons (30% complete).

What are the total equivalent units for direct materials for October if materials are added at the beginning of the process?
units

Answer 1

Answer-------

Answer using Weighted average method = 72000 units

Answer using FIFO Method= 67,900

Please use the answer applicable in your case

Working for both methods

Statement of Equivalent Units(Weighted average)
				Material		Conversion cost
	Units			Complete %	Equivalent units	Complete %	Equivalent units
Transferred out	68,600			100%	68,600	100%	68,600
Ending WIP	3,400			100%	3,400	25%	850
Total	72,000			Total	72,000	Total	69,450

.

STEP 1 (FIFO)
Reconciliation of Units
	Units	% already completed		% completed this period
		Material		Material
Beginning WIP	4,100	100%		0%
Units introduced	67,900
Total units to be accounted for	72,000
Completed and Transferred unit	68,600	0%		100%
Ending WIP	3,400	0%		100%

.

STEP 2 (FIFO)
Equivalent Units
	Total Units	Material
Units Transferred:		% completed this period	Equivalent Units
From WIP	4,100	0%	-
From units started/Introduced	64,500	100%	64,500
Total	68,600		64,500
	Total Units	Material
Ending WIP		% completed this period	Equivalent Units
Total	3,400	100%	3,400
Total EUP	72,000		67,900