Saturday, 26 February 2022

During the period, the Mixing Department completed 500 units and transferred them out to the Baking Department. At the end of the period, there were 4,000 units that are 40% complete as to direct materials in the Mixing Department. The equivalent units of production for direct materials equal:

 During the period, the Mixing Department completed 500 units and transferred them out to the Baking Department. At the end of the period, there were 4,000 units that are 40% complete as to direct materials in the Mixing Department. The equivalent units of production for direct materials equal:

multiple choice

    200 EUP.
    500 EUP.
    1,600 EUP.
    2,100 EUP. Correct
    6,100 EUP.

Explanation

Knowledge Check 01

Equivalent units of production (EUP) for direct materials = Equivalent units completed and transferred out of 500 (or 500 × 100%) + Equivalent units for ending goods in process of 1,600 (or 4,000 × 40%) = 2,100 EUP.

 The cost of the beginning work in process inventory was comprised of $3,000 of direct materials, $10,000 of direct labor, and $10,000 of factory overhead. Costs incurred during the period were comprised of $15,000 of direct materials costs, and $100,000 of conversion costs. The equivalent units of production (EUP) for the period were 9,000 for direct materials and 6,000 for conversion. The costs per EUP were:

multiple choice

    $0.33 per EUP for direct materials and $3.34 per EUP for conversion.
    $1.67 per EUP for direct materials and $9.43 per EUP for conversion.
    $1.10 per EUP.
    $2.00 per EUP for direct materials and $20.00 per EUP for conversion. Correct

Explanation

Knowledge Check 01

Cost per EUP for direct materials = (Direct materials cost in beginning work in process inventory of $3,000 + Direct materials cost incurred of $15,000) ÷ 9,000 EUP = $2.00 per EUP.

Cost per EUP for conversion = (Direct labor cost in beginning work in process inventory of $10,000 + Factory overhead cost in beginning work in process inventory of $10,000 + Conversion cost incurred of $100,000) ÷ 6,000 EUP = $20.00 per EUP.

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