The Kirkland Department of Delta Company began the month of December with beginning work in process of "4,000" units that are "100%" complete as to materials and "30%" complete as to conversion costs. Units transferred out are "10,000" units. Ending work in process contains "5,000" units that are "100%" complete as to materials and "60%" complete as to conversion costs.

InstructionsCompute the equivalent units of production for materials and conversion costs for the month of December.

Instructions are below.

Explanation:

Giving the following information:

December with beginning work in process of 4,000 units that are 100% complete as to materials and 30% complete as to conversion costs. Units transferred out are "10,000" units.

Ending work in process contains 5,000 units that are 100% complete as to materials and "60%" complete as to conversion costs.

To calculate the equivalent units, we need to use the following structure:

Beginning work in process = beginning inventory * %incompleted

Units started and completed = units completed - beginning WIP

Ending work in process completed = Ending WIP * %completed

=Number of equivalent units

Direct material:

Beginning work in process = 0

Units started and completed = 10,000

Ending work in process completed = 5,000

= 15,000 units

Conversion costs:

Beginning work in process = 4,000*0.7 = 2,800

Units started and completed = 10,000 - 2,800 = 7,800

Ending work in process completed = 5,000*0.6 = 3,000

= 13,600 units