Asked by Nhlanhlo Nhlekza on May 28, 2024
Verified
The Molding Department of Kennett Company has the following production data: beginning work in process 25000 units (60% complete) started into production 475000 units completed and transferred out 450000 units and ending work in process 50000 units (40% complete) . Assuming conversion costs are incurred uniformly during the process the equivalent units for conversion costs are:
A) 500000.
B) 455000.
C) 470000.
D) 450000.
Equivalent Units
A concept in process costing that converts partially completed units into a number of fully completed units.
Conversion Costs
The total cost of converting raw materials into finished goods, typically including labor and overhead expenses.
Production Data
Information and statistics related to the quantity and cost of materials and labor used in the production of goods.
- Attain comprehension of the concept relating to equivalent units of production in process costing.
- Work out the equivalent amounts for materials and transformation costs.
Verified Answer
The equivalent units of the completed and transferred out units are 450,000 units.
The equivalent units of the ending work in process are calculated as:
50000 units x 40% = 20,000 units
Therefore, the total equivalent units for conversion costs are:
450,000 units + 20,000 units = 470,000 units.
So, the correct answer is C.
Learning Objectives
- Attain comprehension of the concept relating to equivalent units of production in process costing.
- Work out the equivalent amounts for materials and transformation costs.
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