Question Completion:
During April, the production department of a process manufacturing system completed a number of units of a product and transferred them to finished goods. Of these transferred units, 60,000 were in process in the production department at the beginning of April.
Answer:
1. The number of units transferred to the Finished Goods Inventory is 218,000.
2. Number of equivalent units with respect to materials and conversion:
Materials = 305,600
Conversion = 264,600
Explanation:
a) Data and Calculations:
Materials Conversion
Beginning inventory 60% 40%
Units completed before 36,000 24,000
Units completed now 24,000 36,000
Equivalent units of production:
Started and completed 240,000 240,000
Ending inventory (82,000 units) 80% 30%
= 65,600 24,600
Total equivalent unit 305,600 264,600
The number of units transferred to finished:
Beginning inventory units 60,000
Units started and completed 240,000
Total units available 300,000
less Ending inventory units 82,000
Units transferred out 218,000
b) Using the weighted-average method, the equivalent units of production are equal to the units started and completed plus the units of ending inventory based on the degree of completion.
