Asked by Regan Waite on Jun 03, 2024
Verified
Minor Company had the following department data: Physical Units Work in process, July 130,000 Completed and transferred out 165,000 Work in process, July 3145,000\begin{array}{lr}&\text { Physical Units }\\\text { Work in process, July } 1 & 30,000 \\\text { Completed and transferred out } & 165,000 \\\text { Work in process, July } 31 & 45,000\end{array} Work in process, July 1 Completed and transferred out Work in process, July 31 Physical Units 30,000165,00045,000 Materials are added at the beginning of the process. What is the total number of equivalent units for materials in July?
A) 165000.
B) 180000.
C) 240000.
D) 210000.
Equivalent Units
A concept used in process costing that converts partially completed units into a number of fully equivalent completed units.
Physical Units
A measure used in manufacturing and production to count the actual units produced, irrespective of the production stage.
- Comprehend the notion of equivalent units of production within the framework of process costing.
- Compute equivalent quantities for materials and conversion expenses.
- Comprehend the importance of the stage at which components are introduced in the manufacturing procedure.
Verified Answer
ZK
Zybrea KnightJun 07, 2024
Final Answer :
D
Explanation :
The question is asking for the total number of equivalent units for materials in July. The process of adding materials at the beginning of the process indicates that there is no work-in-process inventory for materials at the beginning of the period. Therefore, we only need to consider the materials added in July.
From the given data, we know that the Materials Department had 50,000 units of materials that were 60% complete at the beginning of July. This means that these units are not yet fully completed and need further processing. The equivalent units for materials for these units would be:
50,000 units x 60% = 30,000 equivalent units
In addition to this, the Materials Department added 180,000 units of materials during July. Since these units were added at the beginning of the process, there is no work-in-process inventory. Therefore, the equivalent units for materials for these units would be the same as the number of units added, i.e.:
180,000 equivalent units
The total equivalent units for materials in July would be the sum of the equivalent units for the 50,000 units that were already in process at the beginning of July and the 180,000 units that were added during July, i.e.:
30,000 equivalent units + 180,000 equivalent units = 210,000 equivalent units
Therefore, the correct answer is D.
From the given data, we know that the Materials Department had 50,000 units of materials that were 60% complete at the beginning of July. This means that these units are not yet fully completed and need further processing. The equivalent units for materials for these units would be:
50,000 units x 60% = 30,000 equivalent units
In addition to this, the Materials Department added 180,000 units of materials during July. Since these units were added at the beginning of the process, there is no work-in-process inventory. Therefore, the equivalent units for materials for these units would be the same as the number of units added, i.e.:
180,000 equivalent units
The total equivalent units for materials in July would be the sum of the equivalent units for the 50,000 units that were already in process at the beginning of July and the 180,000 units that were added during July, i.e.:
30,000 equivalent units + 180,000 equivalent units = 210,000 equivalent units
Therefore, the correct answer is D.
Learning Objectives
- Comprehend the notion of equivalent units of production within the framework of process costing.
- Compute equivalent quantities for materials and conversion expenses.
- Comprehend the importance of the stage at which components are introduced in the manufacturing procedure.
Related questions
It Is Necessary to Calculate Equivalent Units of Production in ...
The Number of Equivalent Units of Production for the Period ...
The Molding Department of Kennett Company Has the Following Production ...
Department S Had 500 Units 60% Completed in Process at ...
Corsi Company Had the Following Department Data Materials Are Added ...