Question

A company's beginning work in process inventory consisted of 20,000 units that were 1/5 complete with respect to direct labor. These beginning units were completed and another 90,000 units were started during the current period. Of those started, 60,000 were finished and the remaining 30,000 were one-third complete at the end of the period. Using the weighted-average method, the equivalent units of production were:A. 60,000B. 74,000C. 76,000D. 86,000E. 90,000

Answer 1

E. 90,000

Step-by-step explanation:

beginning WIP 20,000

start and complete 60,000

transferred out 80,000

ending WIP 30,000 x 1/3 = 10,000

Equivalent units 80,000 + 10,000 = 90,000

Equivalent units under WA method only relates to transferred-out units and the ending WIP

It does not make the difference between beginning inventory and start and complete as FIFo does.