Question

BE3.5 Compute equivalent units of production. (LO 3), AP The Smelting Department of Kiner Company has the following production data for November. Beginning work in process 2,000 units that are 100% complete as to materials and 20% complete as to conversion costs; units transferred out 9,000 units; and ending work in process 7,000 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.

Answer 1

Answer

• Note: Since it is not mentioned whether to use FIFO method or Weighted Average method for calculating the Equivalent no of units, the answers have been provided by BOTH the methods.
• Answer by FIFO method

EUP - FIFO Method	Units	% Material	EUP Materials	% Conversion
Units of ENDING WIP	7,000	100.0%	7,000	40.0%
Units STARTED & COMPLETED	7,000	100%	7,000	100%
Units of beginning WIP	2,000	0.00%	-	80%
Equivalent Units of Production = Answer			14,000

• Answer by Weighted Average Method

EUP - Weighted Average Method	Units	% Material	EUP Materials	% Conversion	EUP - Conversion
Units TRANSFERRED	9,000	100%	9,000	100%	9,000
Units of ENDING WIP	7,000	100%	7,000	40%	2,800
Equivalent Units of Production			16,000		11,800