Question

Equivalent Units of Conversion Costs The Filling Department of Eve Cosmetics Company had 5,900 ounces in beginning work in process inventory (70% complete). During the period, 65,300 ounces were completed. The ending work in process inventory was 3,300 ounces (70% complete).

What are the total equivalent units for conversion costs?

If required, round to the nearest unit.

-------------units

Answer 1

Answer

• Since its not asked whether to use FIFO Method or Weighted Average method for calculating Equivalent units, I’ve calculated Equivalent units by both the methods.
• Working

Units Reconciliation
Units to account for:
Beginning WIP	5,900
Units started this period	65,300
Total Units to account for	71,200
Total Units accounted for:
Completed & Transferred out	67,900
Ending WIP	3,300
Total Units accounted for	71,200

• Equivalent units for conversion cost – FIFO Method

EUP - FIFO Method	Units	% Conversion	EUP - Conversion
	[A]	[B]	[C = A x B]
Units of ENDING WIP	3,300	70%	2,310
Units STARTED & COMPLETED	62,000 [67900 – 5900]	100%	62,000
Units of beginning WIP	5,900	30%	1,770
Equivalent Units of Production			66,080 = ANSWER

• Equivalent units for conversion cost – Weighted Average Method

EUP - Weighted Average Method	Units	% Conversion	EUP - Conversion
Units TRANSFERRED	67,900	100%	67,900
Units of ENDING WIP	3,300	40%	1,320
Equivalent Units of Production			69,220 = ANSWER