Helix Corporation produces prefabricated flooring in a series of steps carried out in production departments. All of the material that is used in the first production department is added at the beginning of processing in that department. Data for May for the first production department follow:

Percent complete

Units Materials Conversion

Work in process inventory, May 1 5,000 100 % 40 %

Work in process inventory, May 31 10,000 100 % 30 %

Materials cost in work in process inventory, May 1 $1,500

Conversion cost in work in process inventory, May 1 $4,000

Units started into production 180,000

Units transferred to the next production department 175,000

Materials cost added during May $54,000

Conversion cost added during May $352,000

Required:

Assume that the company uses the weighted-average method of accounting for units and costs. Determine the equivalent units for May for the first process.

Determine the equivalent units for May for the first process is 363,000 units

Explanation:

Concept of Equivalent Units determines the number of units completed in terms of percentage in completion of inputs added into that process

In our case the Inputs in the process are Materials and Conversion.

Calculation of Equivalent Units in terms of Materials is as follows:

Units transferred to the next production department = 175,000*100% = 175,000

Ending Work in process inventory = 10000*100% = 10000

Total Equivalent Units in terms of Materials = 185000 (175000+10000)

Calculation of Equivalent Units in terms of Conversion is as follows:

Units transferred to the next production department = 175,000*100% = 175,000

Ending Work in process inventory = 10000*30% = 3000

Total Equivalent Units in terms of Conversion = 178000 (175000+3000)

Therefore Total equivalent units for May for the first process is as follows:

Total Equivalent Units in terms of Materials 185,000

Add Total Equivalent Units in terms of Conversion 178,000

Total equivalent units for May for the first process 363,000