Question

B) Jones Metals has two processing departments, Fabrication and Assembly. Metal is placed into production in the Fabrication Department, where it is cut, formed, or ground into various components. These components are transferred to Assembly, where they are welded, polished, and hot-dip galvanized with sealant. The production data follow for these two departments for March 2018: Fabrication: Beginning WIP inventory (100% complete as to material; 45% complete as to conversion) Units started during month Ending WIP inventory (100% complete as to material; 80% complete as to conversion)

Assembly: Beginning WIP inventory (100% complete as to material; 15% complete as to conversion) Units started during month Ending WIP inventory (100% complete as to material; 75% complete as to conversion) 5,000 39,000 6,800 1,500 ? 4,600 Required: Determine the equivalent units of production for each cost component for each department​

Answer 1

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Step-by-step explanation:

To determine the equivalent units of production for each cost component in each department, we need to consider the percentage of completion for both material and conversion for each unit.

Let's calculate the equivalent units for each cost component in each department:

Fabrication Department:

1. Material:

- Beginning WIP inventory: 100% complete, so equivalent units = 100% of 5,000 units = 5,000 units

- Units started during the month: All units started during the month are considered fully completed for material, so equivalent units = 39,000 units

- Ending WIP inventory: 100% complete, so equivalent units = 100% of 6,800 units = 6,800 units

2. Conversion:

- Beginning WIP inventory: 45% complete, so equivalent units = 45% of 5,000 units = 2,250 units

- Units started during the month: All units started during the month are considered fully completed for conversion, so equivalent units = 39,000 units

- Ending WIP inventory: 80% complete, so equivalent units = 80% of 6,800 units = 5,440 units

Assembly Department:

1. Material:

- Beginning WIP inventory: 100% complete, so equivalent units = 100% of 1,500 units = 1,500 units

- Units started during the month: All units started during the month are considered fully completed for material, so equivalent units = 4,600 units

- Ending WIP inventory: 100% complete, so equivalent units = 100% of 0 units (no ending WIP inventory) = 0 units

2. Conversion:

- Beginning WIP inventory: 15% complete, so equivalent units = 15% of 1,500 units = 225 units

- Units started during the month: All units started during the month are considered fully completed for conversion, so equivalent units = 4,600 units

- Ending WIP inventory: 75% complete, so equivalent units = 75% of 0 units (no ending WIP inventory) = 0 units

Therefore, the equivalent units of production for each cost component in each department are as follows:

Fabrication Department:

- Material: 5,000 units + 39,000 units + 6,800 units = 50,800 units

- Conversion: 2,250 units + 39,000 units + 5,440 units = 46,690 units

Assembly Department:

- Material: 1,500 units + 4,600 units + 0 units = 6,100 units

- Conversion: 225 units + 4,600 units + 0 units = 4,825 units