Question

Tip Top Painting Company has the following production data for March: Beginning work in process, 2,000 units, which are 30% complete for conversion costs Units transferred out, 44,000 Units in ending work in process, 9,000, which are 80% complete for conversion costs Materials are added only at the beginning of the process. What is the equivalent units of production during May for direct materials if the FIFO method is used? 51,000 53,000 42,200 42,000

Answer 1

Answer

The physical units are given below

Physical units

Particulars	units
Beginning work in process inventory	2,000
Started	51,000
Total units to be accounted	53,000
Units completed and transferred out	44,000
Ending work in process inventory	9,000
Total units to be accounted	53,000

Materials are added at the beginning of the process.

Out of 44,000 units completed and transferred out 2,000 are completed from beginning work in process and balance is 42,000 units (44,000 - 2,000).

Equivalent units of materials

= 42,000 + 9,000 = 51,000 units

The equivalent unit of material under FIFO method is 51,000 units.

CORRECT Option is 51,000.

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