Answered

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Refer to the following information about the Finishing Department in the Gallagher Factory for the month of June. Gallagher Factory uses the FIFO method of inventory costing.
Beginning Work in Process inventory:
Physical units..... 5000
% complete for materials 70%
% complete for conversion costs 25%
Materials cost from May 7350
Conversion costs from May 3125
Product started:
Physical units 44000
Ending Work in Process inventory:
Physical units 4000
% complete for materials 40%
% complete for conversion costs 10%
Manufacturing costs for June:
Materials 96975
Conversion costs 79470
Compute equivalent units for direct materials for June.

Sagot :

Answer:

the equivalent units for direct material is 43,100 units

Explanation:

The computation of the equivalent units for direct material is shown below:

= Ending work in process units + units started and completed + opening work in process units

= 40% of 4,000 units + (44,000 - 4,000) + 30% of 5,000

= 1,600 units + 40,000 units + 1,500 units

= 43,100 units

hence, the equivalent units for direct material is 43,100 units

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