Bunn Company produces calendars in a one-department process. The following information is available:
The units still in process are 100 percent complete with respect to direct materials and 60 percent complete with respect to conversion costs.
-The equivalent units for conversion costs are
A) 6,000.
B) 30,000.
C) 24,000.
D) 27,600.

Question

Bunn Company produces calendars in a one-department process. The following information is available:
  The units still in process are 100 percent complete with respect to direct materials and 60 percent complete with respect to conversion costs.
-The equivalent units for conversion costs are
A) 6,000. 
B) 30,000. 
C) 24,000. 
D) 27,600.

Quizplus · Accepted Answer

The equivalent units for conversion costs are 27,600. This is calculated by multiplying the number of units completed and transferred out (6,000) by the percentage of completion for conversion costs (100%) and adding the number of units in ending work in process (21,600) multiplied by the percentage of completion for conversion costs (25%).

Bunn Company Produces Calendars in a One-Department Process