Asked by Ayanna Akbar on Jul 27, 2024
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Department M had 2,000 units 40% completed in process at the beginning of June, 12,000 units completed during June, and 1,200 units 25% completed at the end of June. What was the number of equivalent units of production for conversion costs for June if the first-in, first-out method is used to cost inventories?
A) 11,500 units
B) 11,200 units
C) 15,200 units
D) 10,000 units
First-In, First-Out
An inventory valuation method where goods first purchased or produced are the first to be sold or used, assuming the earliest inventory costs flow out first.
Conversion Costs
Conversion costs are manufacturing or production costs that include direct labor and overhead expenses, necessary to convert raw materials into finished goods.
Equivalent Units
Equivalent units refer to a conversion measure used in cost accounting to express the amount of work done by manufacturers on units that are only partially completed at the end of an accounting period.
- Calculate equivalent units of production using the first-in, first-out (FIFO) method.
Verified Answer
Learning Objectives
- Calculate equivalent units of production using the first-in, first-out (FIFO) method.
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