Question

Concord Company uses the FIFO method to compute equivalent units. It has 4000 units in beginning work in process, 20% complete as to conversion costs and 50% complete as to materials costs, 67000 units started, and 5800 units in ending work in process, 30% complete as to conversion costs, and 80% complete as to materials cost. How much are the equivalent units for materials under the FIFO method?

Answer 1

Answer:

67,840 units

Explanation:

The computation of the equivalent units for material by using the FIFO method is shown below:

Particulars       Unit       Percentage completion   Equivalent units

Opening

inventory       4,000 units     50%                          2,000 units

Completed

& transferred

(67,000

- 5,800)        61,200 units    100%                         61,200 units

Closing  

inventory      5,800 units      80%                         4,640 units

Total                                                                       67,840 units