Question

at the beginning of the month there were no units in beginning work in process and 115,000 units were begun during the month. At the end of the month there were 40,000 units that were 30% complete as to conversion costs in ending work in process. If all materials are included when the production begins, the equivalent units for conversion costs is:

Answer 1

The equivalent units for conversion costs is 87,000 units

Step-by-step explanation:

First, we need to calculate the completed during the month

Completed units = Units begun during the month - Units in Work in process

Completed units = 115,000 - 40,000

Completed units = 75,000 units

Now calculate the equivalent unit in respect of conversion cost as follow

Equivalent units ( Conversion cost ) = Units completed in the month + ( Units in work in process x percentage of completion )

Equivalent units ( Conversion cost ) = 75,000 units + ( 40,000 x 30% )

Equivalent units ( Conversion cost ) = 75,000 units + 12,000 unints

Equivalent units ( Conversion cost ) = 87,000 units