The following production data were taken from the records of the finishing department for June:Inventory in process, June 1, 25% completed 1,500 unitsTransferred to finished goods during June 5,000 unitsEquivalent units of production during June 5,200 unitsDetermine the number of equivalent units of production in the June 30, finishing department inventory, assuming that the first-in, first-out method is used to cost inventories. The completion percentage of 25% applies to both direct materials and conversion costs. 300 units1,000 units200 units575 units

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Business

Araceli Shea

3 March, 00:17

The following production data were taken from the records of the finishing department for June:Inventory in process, June 1, 25% completed 1,500 unitsTransferred to finished goods during June 5,000 unitsEquivalent units of production during June 5,200 unitsDetermine the number of equivalent units of production in the June 30, finishing department inventory, assuming that the first-in, first-out method is used to cost inventories. The completion percentage of 25% applies to both direct materials and conversion costs. 300 units1,000 units200 units575 units

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Raina Mclaughlin · Answer 1

575 units

Explanation:

The computation of the equivalent units of production for the end of the period is shown below:

= Equivalent units of production during June - June 1 work in process units * remaining percentage - units started and completed

= 5,200 units - 1,500 units * 75% - 3,500 units

= 5,200 units - 1,125 units - 3,500 units

= 575 units

Units started and completed = 5,000 units - 3,500 units = 1,500 units