Question

M Company manufactures tables. At the beginning of December, the beginning work in process inventory was 300 units, which were 40% complete for conversion. 5,000 units were started in December. At the end of December, the ending work in process is 500 units, which are 50% complete for conversion. Using the FIFO process costing method, what are the December equivalent units for conversion

Answer 1

Answer: Equivalent units for conversion = 4870 units

Explanation:

Given that,

Beginning work in process inventory = 300 units

Beginning work in process inventory for conversion = 40% of 300 units

                                                                                       = 120 units

5,000 units were started in December.

Ending work in process = 500 units

Ending work in process inventory for conversion = 50% of 500 units

                                                                                  = 250 units

Units started and completed = 5000 - 500

                                                = 4500 units

Equivalent units for conversion = 4870 units