Reference: 04-07
The information below was obtained from the records of the first processing department of Moore Company for the month of May. The company uses the weighted-average method in its process costing system. $$\begin{array} { | l | l | l | }
\hline & \text { Units } & \begin{array} { l }
\text { Labour and Overhead } \
\text { (Percentage Complete) }
\end{array} \
\hline \text { Work in process, May 1 } & 10,000 & 40 \% \
\hline \text { Units started } & 64,000 & \
\hline \text { Completed and transferred out } & 60,000 & \
\hline \text { Work in process, May 31 } & 14,000 & 70 \% \
\hline
\end{array}$$ All materials are added at the beginning of the process.
-The equivalent units of production for labour and overhead for the month of May were
A)69,800 units.
B)73,800 units.
C)65,800 units.
D)60,000 units.

Question

Reference: 04-07
The information below was obtained from the records of the first processing department of Moore Company for the month of May. The company uses the weighted-average method in its process costing system. $$\begin{array} { | l | l | l | } 
\hline & \text { Units } & \begin{array} { l } 
\text { Labour and Overhead } \
\text { (Percentage Complete) }
\end{array} \
\hline \text { Work in process, May 1 } & 10,000 & 40 \% \
\hline \text { Units started } & 64,000 & \
\hline \text { Completed and transferred out } & 60,000 & \
\hline \text { Work in process, May 31 } & 14,000 & 70 \% \
\hline
\end{array}$$ All materials are added at the beginning of the process.
-The equivalent units of production for labour and overhead for the month of May were
A)69,800 units.
B)73,800 units.
C)65,800 units.
D)60,000 units.

Quizplus · Accepted Answer

The equivalent units of production for labor and overhead are calculated as follows: Completed and transferred out units are fully 100% complete for labor and overhead, so that's 60,000 units. The work in process at the end of the month is 14,000 units at 70% completion for labor and overhead, which equals 9,800 equivalent units (14,000 units * 70%). The work in process at the beginning of the month had already been 40% completed, but since we use the weighted-average method, we consider the total units moving through the process. Therefore, the equivalent units for labor and overhead are 60,000 (completed and transferred out) + 9,800 (WIP at end) = 69,800 units.

Reference: 04-07 the Information Below Was Obtained from the Records

Reference: 04-07
the Information Below Was Obtained from the Records