Question

At the start of the month, Oak Inc. had 58,000 units of beginning work in process that were 65% complete. Over the course of the month, the firm completed and transferred out 208,900 units, and at the end of the month, it had 59,400 units in ending work in process that were 70% complete. In comparison, Maple Inc. began the month with 61,200 units of beginning work in process that were 60% complete. Over the course of the month, the firm completed and transferred out 210,500 units, and at the end of the month, it had 52,400 units in ending work in process that were 90% complete. Both firms add 40% of materials at the beginning of the process and the remaining 60% when the units are 70% complete. Both firms also add 25% of conversion costs at the beginning of the process and the remaining 75% when the units are 90% complete. According to these figures, Oak has ________ equivalent units of production for materials and ________ equivalent units of production for conversion costs than Maple.a. more ; fewerb. fewer; fewerc. fewer; mored. more; more

Answer 1

Answer:

According to these figures, Oak has  more   equivalent units of production for materials and     fewer    equivalent units of production for conversion costs than Maple

Explanation:

Oak EU:

Transferred units less percentage of completion beginning inventory plus completion on ending inventory

Materials:

208,900

58,000 x 40% (they were added the 40% at beginning but, not the remaining 60%)

59,400 x 100% (they reach the 70% threshold so the rest of the materials where added)

Equivalent units Materials 245100

Conversion:

208,900 - 58,000 x 65% + 59,400 x 70%

212780

Maple EU:

Materials:

210,500 - 61,200 x 40% + 52,400 x 100% =

238420

Conversion:

210,500 - 61,200 x 60% + 52,400 x 90% =

220940

Oak v Maple:

Materials:

Oak             Maple

245100 > 238420

Conversion:

Oak            Maple

212780   <   220940