At the beginning of the month, the Painting Department of Skye Manufacturing had

Question

At the beginning of the month, the Painting Department of Skye Manufacturing had 23,000 units in inventory, 70% complete as to materials, and 25% complete as to conversion. During the month the department started 118,000 units and transferred 124,500 units to the next manufacturing department. At the end of the month, the department had 16,500 units in inventory, 40% complete as to materials and 10% complete as to conversion Skye Manufacturing uses he weighted average met od of process costing, compute the equivalent units for materials and conversion respectively for the Painting Department. 0135:01 Multiple Choice eBook 131,100 materlals; 126,150 conversion. 115,000 materials; 120,400 conversion. 131,100 materlals; 120,400 conversion. 126,150 materials; 131,100 conversion. 115,000 materials; 126,150 conversion.

Explanation / Answer

As per weighted average cost method , completed and transferred units percentage completion always taken as 100% for both materials and conversion costs .

Equivalent units = units completed and transferred +( units in closing inventory * percentage completion closing )

Equivalent units in material = 124500+16500*40%

= 131100

Equivalent units in conversion cost = 124500+16500*10%

= 126150 .

Hence part a is correct .

Rest b,c,d ,e are incorrect .

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