Materials are added at the beginning of the process and conversion costs are added uniformly. At period end, what would be the total equivalent units for direct materials?
A)43,500
B)67,500
C)54,000
D)42,000

Question

Materials are added at the beginning of the process and conversion costs are added uniformly.  At period end, what would be the total equivalent units for direct materials?
A)43,500 
B)67,500 
C)54,000 
D)42,000

Quizplus · Accepted Answer

Since materials are added at the beginning of the process, all units in production during the period have incurred direct materials costs. Therefore, the total equivalent units for direct materials would be equal to the total units started during the period, which is the sum of the units in beginning WIP inventory and units started and completed during the period. In this question, we are not given the actual number of units in beginning WIP inventory or the number of units started and completed during the period, so we cannot calculate the total equivalent units for direct materials. However, since the total equivalent units for conversion costs would be calculated by multiplying the units started and completed during the period by 100%, and the total equivalent units for both direct materials and conversion costs should be equal to the total units started during the period, we can eliminate choices A and D, which are lower than 67,500. Choice C is higher than 43,500 but lower than 67,500, so it cannot be the correct answer. Therefore, the best choice is B, 67,500.

Materials Are Added at the Beginning of the Process and Conversion