Clean Corporation manufactures liquid window cleaner. The following information

Question

Clean Corporation manufactures liquid window cleaner. The following information concerns its work in process: • Beginning inventory, 42,000 (50 percent complete with respect to materials and 32 percent complete with respect to conversion costs). • Transferred out, 212,000 gallons. • Ending inventory (materials are 19 percent complete; conversion costs are 11 percent complete). • Started this month, 244,000 gallons.

Compute the equivalent units for materials using FIFO.

(a)

Compute the equivalent units for materials using FIFO.

(b) Compute the equivalent units for conversion costs using FIFO.

Explanation / Answer

Ending Inventory in units = 42,000 opening + 244,000 units stared during the year - 212,000 units transferred = 74,000 units

Materials Conversion Costs Unit transferred out 212,000 212,000 Equivalent units in ending inventory Materials (74,000 * 19%) 14,060 Conversion cost (74,000 * 11%) 8,140 Total Equivalent units 226,060 220,140

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