Answer:
The equivalent units of production for materials and conversion costs are 98,000 units each
Explanation:
For computing the equivalent units of production for materials and conversion costs first, we have to compute the units started and completed units which is shown below:
= Beginning work-in-process inventory units + transferred units - ending work-in-process inventory units
= 30,000 units + 95,000 units - 45,000 units
= 80,000 units
Now the equivalent units of production would be
For material costs:
= (Units started and completed units × completed percentage) + (ending inventory units × completed percentage)
= (80,000 units × 100%) + (45,000 units × 40%)
= 80,000 units + 18,000 units
= 98,000 units
For conversion costs:
= (Units started and completed units × completed percentage) + (ending inventory units × completed percentage)
= (80,000 units × 100%) + (45,000 units × 40%)
= 80,000 units + 18,000 units
= 98,000 units
