Question

A department adds raw materials to a process at the beginning of the process and incurs conversion

costs uniformly throughout the process. For the month of January, there were no units in the

beginning work in process inventory; 90,000 units were started into production in January; and

there were 20,000 units that were 40% complete in the ending work in process inventory at the end

of January. What were the equivalent units of production for conversion costs for the month of

January? (Units transferred out + Equivalent unit of ending units)

(Round your answer to a whole number if needed. Just put the number in the blank. No $ sign.)

Answer 1

Answer: 78,000 units

Explanation:

Equivalent units of production for conversion costs = Units completed and transferred out + Equivalent unit of ending units

Units completed and transferred out = Units started - Ending units

= 90,000 - 20,000

= 70,000 units

Equivalent unit of ending units = 20,000 * 40%

= 8,000 units

Equivalent units of production for conversion costs = 70,000 + 8,000

= 78,000 units