The Glove Company uses the weighted average method.The beginning work in process consists of 25,000 units (100% completed as to materials and 50% complete as to conversion costs).The number of units completed was 100,000.The ending work in process consists of 15,000 units (100% complete as to materials and 25% complete as to conversion costs).What would be the equivalent units of production for conversion costs?
A)40,000
B)103,750
C)112,500
D)116,250

Question

Quizplus · Accepted Answer

The equivalent units of production for conversion costs can be calculated as follows: - The beginning work in process had 25,000 units, which were already 50% complete as to conversion costs, so that adds 12,500 equivalent units (25,000 units * 50%).- The units completed during the period were 100,000 units, which would be 100% complete as to conversion costs, adding 100,000 equivalent units.- The ending work in process had 15,000 units, which were 25% complete as to conversion costs, adding 3,750 equivalent units (15,000 units * 25%).Adding these together gives a total of 116,250 equivalent units for conversion costs (12,500 + 100,000 + 3,750). However, the beginning work in process is not added again since it's already accounted for in the units completed or in the ending work in process. Therefore, the correct calculation only considers the units completed and the ending work in process, which gives us 100,000 + 3,750 = 103,750 equivalent units for conversion costs.

The Glove Company Uses the Weighted Average Method