Use this information about Department G to answer the questions that follow.

Department G had 3,600 units, 40% completed at the beginning of the period, 12,000 units were completed during the period, 2,000 units were 20% completed at the end of the period, and the following manufacturing costs were debited to the departmental work in process account during the period:

-Assuming that all direct materials are placed in process at the beginning of production and that the first-in, first-out method of inventory costing is used, determine the equivalent units for direct materials and conversion costs, respectively.
A) 14,000 and 12,160
B) 10,400 and 10,960
C) 14,000 and 13,600
D) 10,400 and 10,240

Question

Use this information about Department G to answer the questions that follow.
​
Department G had 3,600 units, 40% completed at the beginning of the period, 12,000 units were completed during the period, 2,000 units were 20% completed at the end of the period, and the following manufacturing costs were debited to the departmental work in process account during the period:
​
  ​
-Assuming that all direct materials are placed in process at the beginning of production and that the first-in, first-out method of inventory costing is used, determine the equivalent units for direct materials and conversion costs, respectively.
A) 14,000 and 12,160 
B) 10,400 and 10,960 
C) 14,000 and 13,600 
D) 10,400 and 10,240

Quizplus · Accepted Answer

To calculate the equivalent units, we need to add the completed units with the units in process, after multiplying them by their percentage of completion.

Direct materials:
3,600 x 40% = 1,440 (units in process at beginning)
12,000 (completed units)
2,000 x 20% = 400 (units in process at end)
Total equivalent units for direct materials = 1,440 + 12,000 + 400 = 13,840

Conversion costs:
3,600 x 40% = 1,440 (units in process at beginning)
12,000 (completed units)
2,000 x 20% = 400 (units in process at end)
Plus:
3,600 x 60% = 2,160 (degree of completion for conversion costs on units in process)
12,000 x 100% = 12,000 (degree of completion for conversion costs on completed units)
2,000 x 80% = 1,600 (degree of completion for conversion costs on units in process at end)
Total equivalent units for conversion costs = 1,440 + 12,000 + 400 + 2,160 + 12,000 + 1,600 = 29,600

Therefore, the equivalent units for direct materials and conversion costs, respectively, are 10,400 and 10,960, which corresponds to choice B.

Use This Information About Department G to Answer the Questions