Question

Pierce & Company provides the following information concerning the work in process at its plant:

• Beginning inventory was partially complete (materials are 100 percent complete, conversion costs are 40 percent complete).
• Started this month, 252.000 units.
• Transferred out, 210,000 units.
• Ending inventory, 140,000 units (materials are 100 percent complete, conversion costs are 45 percent complete).
Required: Compute the equivalent units for materials using the weighted-average method.

Answer 1

To determine the equivalent units for materials, add the 210,000 units transferred out to the 140,000 units in ending inventory, which results in 350,000 equivalent units for materials using the weighted-average method.

Step-by-step explanation:

To compute the equivalent units for materials using the weighted-average method, we must account for units in both the beginning inventory and the units started and completed during the period. Since materials are 100% complete for both beginning inventory and ending inventory, we simply take the number of units transferred out plus the units in the ending inventory.

Beginning inventory units will not be included in the calculation for materials as they are already 100% complete. So for materials, the equivalent units are:

• Transferred out: 210,000 units
• Ending inventory: 140,000 units

Adding these together, we get:

210,000 + 140,000 = 350,000 equivalent units for materials.