Question

Clonex Labs, Inc., uses the FIFO method in its process costing system. The following data are available for one department for October:

		Percent Completed
	Units	Materials		Conversion
Work in process, October 1	28,000	64	%	27	%
Work in process, October 31	20,000	82	%	40	%

The department started 167,000 units into production during the month and transferred 175,000 completed units to the next department.

Required:

Compute the equivalent units of production for materials and conversion for October.

Answer 1

	Materials	Conversion
To complete Work in process, October 1	10080	20440
Units started and completed	147000	147000
Work in process, October 31	16400	8000
Equivalent units of production	173480	175440
Workings:
	Materials	Conversion
To complete Work in process, October 1	=28000*(1-64%)	=28000*(1-27%)
Units started and completed	=175000-28000	=175000-28000
Work in process, October 31	=20000*82%	=20000*40%