Using the weighted-average method of process costing,the equivalent units of conversion activity total:
A)60,400.
B)68,000.
C)69,400.
D)74,000.
E)some other amount.

Question

Quizplus · Accepted Answer

The equivalent units of conversion activity are calculated by multiplying the units completed and transferred out by 1 and the equivalent units in ending inventory by the percentage of completion. Using the weighted-average method, the equivalent units of conversion activity for the units completed and transferred out are 60,000 (40,000 + 20,000). The equivalent units of conversion activity for the ending inventory are calculated as follows: 
10,000 units × 70% = 7,000 equivalent units
20,000 units × 25% = 5,000 equivalent units
Therefore, the total equivalent units of conversion activity are 60,000 + 7,000 + 5,400 = 69,400.

Using the Weighted-Average Method of Process Costing,the Equivalent Units of Conversion