Question

1. Equivalent Units of Production

   The following information concerns production in the Baking Department for March. All direct materials are placed in process at the beginning of production.
   

   ACCOUNT Work in Process—Baking Department							ACCOUNT NO.
   Date		Item	Debit		Credit		Balance
   							Debit		Credit
   Mar.	1	Bal., 18,000 units, 1⁄4 completed					14,760
   	31	Direct materials, 336,000 units	252,000				266,760
   	31	Direct labor	40,000				306,760
   	31	Factory overhead	60,530				367,290
   	31	Goods finished, 330,000 units			346,410		20,880
   	31	Bal. ? units, 2⁄5 completed					20,880

   a. Determine the number of units in work in process inventory at March 31.
   units

   b. Determine the equivalent units of production for direct materials and conversion costs in March. If an amount is zero, enter in "0".

   Baking Department
   Equivalent Units of Production for Direct Materials and Conversion Costs
   For March
   	Whole Units	Equivalent Units Direct Materials	Equivalent Units Conversion
   Inventory in process, March 1
   Started and completed in March
   Transferred to finished goods in March
   Inventory in process, March 31
   Total

Answer 1

a. Ending Work in Process = Beginning Work in Process + Units Started – Completed

                        = 18,000 + 336,000 – 330,000

                        = 24,000 Units.

b.

Baking Department
Equivalent Units of Production for Direct Materials and Conversion Costs
For March
	Whole Units	Equivalent Units Direct Materials	Equivalent Units Conversion
Inventory in process, March 1	18,000	0	18,000 * 3 / 4 = 13,500
Started and completed in March	333,000 – 18,000 = 315,000	315,000	315,000
Inventory in process, March 31	24,000	24,000	24,000 * 2 / 5 = 9,600
Total		339,000	338,100