Equivalent Units of Materials CostThe Filling Department of Eve Cosmetics Company had 2,400 ounces in beginning work in process inventory (90% complete). During theperiod, 40,300 ounces were completed. The ending work in process inventory was 2,000 ounces (50% complete).What are the total equivalent units for direct materials if materials are added at the beginning of the process?units

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Asked Oct 26, 2019
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Equivalent Units of Materials Cost
The Filling Department of Eve Cosmetics Company had 2,400 ounces in beginning work in process inventory (90% complete). During the
period, 40,300 ounces were completed. The ending work in process inventory was 2,000 ounces (50% complete).
What are the total equivalent units for direct materials if materials are added at the beginning of the process?
units
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Equivalent Units of Materials Cost The Filling Department of Eve Cosmetics Company had 2,400 ounces in beginning work in process inventory (90% complete). During the period, 40,300 ounces were completed. The ending work in process inventory was 2,000 ounces (50% complete). What are the total equivalent units for direct materials if materials are added at the beginning of the process? units

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Step 1

Process Costing:

 

Process costing is a method of cost accounting, which is used when the production is continuous, and the product needs various processes to complete. This method is used to ascertain the cost of the product at each process or stage of production.

 

Equivalents units of production:

 

The activity of a processing department in terms of fully completed units is known as equivalents units. It includes the completed units of direct materials and conversion cost of beginning work in process, units completed, and transferred out, and ending work in process.

Step 2

Calculate the total equivalent units for direct materials:

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Equivalent Units for Direct Materials Percent of materials Equivalent units Whole Units Particulars added for direct (A) during the materials (AxB) period (B) 0% Inventory in process, beginning Add: Started and completed during the period (1) Transferred out of Filling (Completed) Add: Inventory in process, Ending Total units to be assigned costs 2,400 0 37,900 100% 37,900 37,900 2,000 39,900 40,300 100% 2,000 42,300

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Step 3

Working Note (1):

 

Calculate the units started and completed duri...

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Units started and completed' Units completed during the period-) = Opening work in proce ss inventory during the period - 40,300units-2,400units =37.900 units

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