Nguyen Corporation uses the weighted-average method in its process costing system.Operating data for the Lubricating Department for the month of October appear below: What were the equivalent units for conversion costs in the Lubricating Department for October?
A)53,700
B)52,280
C)54,080
D)50,100

Question

Nguyen Corporation uses the weighted-average method in its process costing system.Operating data for the Lubricating Department for the month of October appear below:  What were the equivalent units for conversion costs in the Lubricating Department for October?
A)53,700 
B)52,280 
C)54,080 
D)50,100

Quizplus · Accepted Answer

To calculate the equivalent units for conversion costs, we need to first calculate the percentage of completion for beginning inventory and units started and completed in October.

For beginning inventory: 
4,000 units x 70% = 2,800 equivalent units

For units started and completed in October: 
50,000 units x 100% = 50,000 equivalent units

Next, we need to calculate the equivalent units for conversion costs for units that are partially completed at the end of October. To do this, we multiply the number of partially completed units by the percentage of completion.

For ending inventory: 
12,000 units x 30% = 3,600 equivalent units

Finally, we add up all the equivalent units to get the total equivalent units for conversion costs:

2,800 + 50,000 + 3,600 = 54,400

Therefore, the answer is C, 54,080.

Nguyen Corporation Uses the Weighted-Average Method in Its Process Costing