Question

Equivalent Units of Materials Cost

The Rolling Department of Oak Ridge Steel Company had 10,800 tons in beginning work in process inventory (30% complete) on July 1. During July, 67,800 tons were completed. The ending work in process inventory on July 31 was 3,400 tons (70% complete).

What are the total equivalent units for direct materials for July if materials are added at the beginning of the process?

Answer 1

Equivalent Units of material 71,200

Working:

			UNITS	Material Cost		Conversion
				% Completion	Units	% Completion	Units
Units started and completed			67,800	100%	67,800	100%	44,400
Ending Work in Process			3,400	100%	3,400	70%	2,380
Total Equivalent units			71,200		71,200		46,780

Equivalent units of material is 71,200 units

Note:

Note: As no method describes, weighted average method has been applied