Question

During a​ period, 40,200 units were completed and​ 3,200 units were in ending WIP Inventory. Ending WIP was​ 95% complete for direct materials and​ 50% complete for conversion costs. What are the equivalent units for direct​ materials?

Answer 1

Answer:

The equivalent units for direct materials are 43,240.

Explanation:

Given:

During a​ period, 40,200 units were completed and​ 3,200 units were in ending WIP Inventory. Ending WIP was​ 95% complete for direct materials.

Now, to find the equivalent units for direct​ materials.

Complete units = 40,200.

Ending WIP (work in progress) Inventory = 3,200.

As, ending WIP was​ 95% complete for direct materials.

Thus, ending WIP Inventory = 95% of 3,200.

= $\frac{95}{100} \times 3,200$

$=0.95\times 3,200$

$=\ 3,040.$

Now, to get the equivalent units for direct​ materials by adding complete units and ending WIP Inventory:

$Complete\ units\ +\ ending\ WIP\ Inventory$

$=40,200+3,040$

$=43,240.$

Therefore, the equivalent units for direct materials are 43,240.