Question

Equivalent Units of Conversion Costs The Filling Department of Eve Cosmetics Company had 4,000 ounces in beginning work in process inventory (60% complete). During the period, 46,000 ounces were completed. The ending work in process inventory was 8,000 ounces (25% complete).

What are the total equivalent units for conversion costs? If required, round to the nearest unit.

Answer 1

The total equivalent units for conversion cost = 45,600 ounces

Step-by-step explanation:

Let us arrange the information in a tabular form to help in solution:

% conversion equivalent units

Particulars whole units completed for conversion

Beginning inventory in process 4,000 40% 1,600

started and completed in period 42,000** 100% 42,000

completed . . . . . . . . . . . . . . . . . . 46,000 43,600

ending inventory in process . . . . 8,000 25% 2,000

Total units to be assigned cost 54,000 45,600

Therefore, the total equivalent units for conversion cost = 45,600 ounces

**Note the inventory that was started and completed within the period is the inventory that was 100% completed within the period and it is the difference between the total inventory completed within the period and the beginning inventory, and this is represented as:

46,000 - 4,000 = 42,000 ounces.