Question

Domingo Corporation uses the weighted-average method in its process costing system. This month, the beginning inventory in the first processing department consisted of 500 units. The costs and percentage completion of these units in beginning inventory were: Cost Percent Complete Materials costs $ 5,600 50% Conversion costs $ 1,800 20% A total of 6,900 units were started and 6,200 units were transferred to the second processing department during the month. The following costs were incurred in the first processing department during the month: Cost Materials costs $ 158,800 Conversion costs $ 120,500 The ending inventory was 85% complete with respect to materials and 75% complete with respect to conversion costs. What are the equivalent units for conversion costs for the month in the first processing department

Answer 1

6,500

Step-by-step explanation:

As per the given question the solution of equivalent units for conversion costs is provided below:-

To reach the equivalent units of conversion first we need to find out the ending inventory units which is below:-

Ending inventory units = Beginning units + Started - Units completed

= 500 + 6,900 - 6,200

= 7,400 - 6,200

= 1,200

Equivalent units of conversion = Units completed + Ending Work in progress

= (6,200 × 100%) + (1,200 × (100% - 75%))

= 6,200 + 300

= 6,500

So, we have calculated the equivalent units of conversion by using the above formula.