Question

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Equivalent Units of Production

The following information concerns production in the Baking Department for March. All direct materials are placed in process at the beginning of production.

ACCOUNT Work in Process—Baking Department							ACCOUNT NO.
Date		Item	Debit		Credit		Balance
							Debit		Credit
Mar.	1	Bal., 6,900 units, 4/5 completed					4,140
	31	Direct materials, 124,200 units	186,300				190,440
	31	Direct labor	55,350				245,790
	31	Factory overhead	31,128				276,918
	31	Goods finished, 126,000 units			267,126		9,792
	31	Bal. ? units, 3/5 completed					9,792

a. Determine the number of units in work in process inventory at March 31.
units

b. Determine the equivalent units of production for direct materials and conversion costs in March. If an amount is zero, enter in "0".

Baking Department
Equivalent Units of Production for Direct Materials and Conversion Costs
For March
	Whole Units	Equivalent Units Direct Materials	Equivalent Units Conversion
Inventory in process, March 1
Started and completed in March
Transferred to finished goods in March
Inventory in process, March 31
Total

Answer 1

Answer

• Requirement [a]
  No of units in WIP at Mar 31 = Beginning units + Units started – Units finished and transferred
  = 6900 + 124200 – 126000
  = 5100 units
• Requirement 2

Baking Department
Equivalent Units of Production for Direct Materials and Conversion Costs
For March
	Whole Units	Equivalent Units	Equivalent Units
		Direct Materials	Conversion
Inventory in process, March 1	6900	0	1380 [6900 x 1/5]
Started and completed in March	119100	119100	119100
Transferred to finished goods in March	126000	119100	120480
Inventory in process, March 31	5100	5100	3060 [5100 x 4/5]
Total	131100	124200	123540