Alaskan Fisheries, Inc., processes salmon for various distributors and it uses the weighted-average method in its process costing system. The company has two processing departments—Cleaning and Packing. Data relating to pounds of salmon processed in the Cleaning Department during July are presented below: Percent Completed Pounds of Salmon Materials Labor and Overhead Work in process inventory, July 1 29,000 100 % 51 % Work in process inventory, July 31 21,000 100 % 90 % A total of 530,000 pounds of salmon were started into processing during July. All materials are added at the beginning of processing in the Cleaning Department. Required: Compute the Cleaning Department's equivalent units of production for materials and for labor and overhead in the month of July.
| Materials | Labor and Overhead | |
| Equivalent units of production |
Answer:
| Materials | Labor and Overhead | |
| equivalent Units of Production | 559,000 | 5,56,900 |
Explanation:
| Unit Transferred Out calculation | |
| WIP, beginning inventory | 29,000 |
| Add: Units started during the period | 5,30,000 |
| Less: WIP Ending inventory | -21,000 |
| Units transferred out | 5,38,000 |
| Equivalent Units Calculation | |||||
| Units | % Materials | EUP-Materials | % Conversion | EUP- Conversion | |
| Units Transferred | 5,38,000 | 100% | 5,38,000 | 100% | 5,38,000 |
| Units of ending WIP | 21,000 | 100% | 21,000 | 90% | 18,900 |
| Total | 5,59,000 | 5,59,000 | 5,56,900 |
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