Weighted average Equivalent units computed LO C2 The production department in a

Question

Weighted average Equivalent units computed LO C2 The production department in a process manufacturing system completed 342,000 units of product and transferred them to finished goods during a recent period. Of these units, 82,000 were in process at the beginning of the period The other 260,000 units were started and completed during the period. At period end, 31,000 units were in process. Prepare the department's equivalent units of production with respect to direct materials under each of three separate assumptions using the weighted average method for process costing.

Explanation / Answer

1. equivalent units of production( material) :

units completion percentage equivalent unit

units completed and transferred 602000 100% 602000

   ending work in progress 31000 50% 15500

617500

Note:- units at beginning + units started with = units completed + units at ending

82000 + units started with = (342000 + 260000) + 31000

   units started with = 602000 + 31000 - 82000

   = 551000

   Assumption that all the 'Ending work in progress'units are 50% completed

2.   

   units completion percentage equivalent unit

units completed and transferred 602000 100% 602000

   ending work in progress 31000 75%   23250

625250

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