Asked by Baylee Grace on Jun 15, 2024
Verified
Cohen Company is trying to determine the equivalent units for conversion costs with 5000 units of ending work in process at 80% completion and 45000 units that are 100% complete as to materials. There are no beginning units in the department. Materials are added at the beginning of the process and conversion costs occur evenly throughout the entire production period. What is the equivalent units of production for conversion costs for the current period?
A) 50000.
B) 49000.
C) 4000.
D) 44000.
Equivalent Units
A concept used in process costing that converts partially completed units into a number of equivalent fully completed units.
Ending Work
The inventory or work-in-process at the end of an accounting period that has not yet been completed.
- Understand thoroughly the idea of equivalent production units as it relates to process costing.
- Assess equivalent measurements for materials and the costs of conversion.
Verified Answer
SM
Shakira MorrisJun 22, 2024
Final Answer :
B
Explanation :
Equivalent units of production for conversion costs will be calculated by considering the units that are 100% complete as to both materials and conversion costs, plus the equivalent units of production for the units that are partially complete. Since all ending work in process units are partially complete, we need to calculate the equivalent units for conversion costs for 5000 units at 80% completion.
Equivalent units for the ending work in process units = 5000 x 80% = 4000
Equivalent units of production for conversion costs = fully complete units + equivalent units for ending work in process
= 45000 + 4000
= 49000.
Therefore, the correct answer is B (49000).
Equivalent units for the ending work in process units = 5000 x 80% = 4000
Equivalent units of production for conversion costs = fully complete units + equivalent units for ending work in process
= 45000 + 4000
= 49000.
Therefore, the correct answer is B (49000).
Learning Objectives
- Understand thoroughly the idea of equivalent production units as it relates to process costing.
- Assess equivalent measurements for materials and the costs of conversion.
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