Answer:
Equivalent units of conversion cost = 317,000 units
Explanation:
T<em>he equivalent unit is the notional whole units which represent incomplete work and is used to apportion cost between cost between work in progress and completed units</em>
Item units Equivalent units
Opening WIP 80,000 (80,000× 80%) = 64,000
Fully worked 250,000 (250,000× 100) = 250,000
Closing WIP 30,000 (30,000× 10%) = <u>3,000</u>
Total equivalent units <u>317,000.</u>
1. DOC for opening inventory is 80%, that is 100%-20%. Remember that 20% work has been done in the previous period, so the balance is to be done in this current period
2. Fully work represent the units of inventory introduced in the current period and completed in the same period. Meaning 100% work was achieved in October .
3. Closing work is only 10% completed. This represent work started this period but not yet completed.
