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Magic Company adds materials at the beginning of the process in Department A. The following information...

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Accounting

Magic Company adds materials at the beginning of the process inDepartment A. The following information on physical units forDepartment A for the month of August is available:

Work in process, August 1 (58% complete with respect toconversion)16,400
Started in August118,800
Completed118,800
Work in process, August 31 (71% complete with respect toconversion)16,400

Required:

a. Compute the equivalent units for materialscosts and for conversion costs using the weighted-averagemethod.

b. Compute the equivalent units for materialscosts and for conversion costs using the FIFO method.

Answer & Explanation Solved by verified expert
3.9 Ratings (583 Votes)

  • Requirement [a]

EUP - Weighted Average Method

Units

% Material

EUP Materials

% Conversion

EUP - Conversion

Units TRANSFERRED

118,800

100%

118,800

100%

118,800

Units of ENDING WIP

16,400

100%

16,400

71%

11,644

Equivalent Units of Production

135,200

130,444

  • Requirement [b]

EUP - FIFO Method

Units

% Material

EUP Materials

% Conversion

EUP - Conversion

Units of ENDING WIP

                                16,400

100.0%

                   16,400

71.0%

                             11,644

Units STARTED & COMPLETED

                              102,400

100%

                102,400

100%

                           102,400

Units of beginning WIP

                                16,400

0.00%

                            -  

42%

                                6,888

Equivalent Units of Production

                 118,800

                           120,932

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