The following information pertains to Jones Company: $$\begin{array} { l r }
& \text {Units } &\
\text { Wark-in-process inventory, March } 1 \text { (30\% complete) } & \text { 20,000 } \
\text { Units tranferred in } & 50,000 \
\text { Wark-in-process inventory, March } 31 \text { (60\% complete) } & 16,000
\end{array}$$ Materials are added at the start of the process.
How many equivalent units for conversion costs would there be using the FIFO method?
A)49,600 units
B)50,000 units
C)57,600 units
D)70,000 units

Question

The following information pertains to Jones Company: $$\begin{array} { l r } 
&  \text {Units   } &\
\text { Wark-in-process inventory, March } 1 \text { (30\% complete) } & \text { 20,000 } \
\text { Units tranferred in } & 50,000 \
\text { Wark-in-process inventory, March } 31 \text { (60\% complete) } & 16,000
\end{array}$$ Materials are added at the start of the process.
How many equivalent units for conversion costs would there be using the FIFO method?
A)49,600 units
B)50,000 units
C)57,600 units
D)70,000 units

Quizplus · Accepted Answer

Under the FIFO method, equivalent units for conversion costs are calculated by considering the work done during the period. The calculation is: (20,000 units x 70% to complete) + 50,000 units transferred in - (16,000 units x 60% complete) = 14,000 + 50,000 - 9,600 = 54,400 equivalent units.

The Following Information Pertains to Jones Company Materials Are Added at the Start of the Process