In applying the first-in, first-out method of costing inventories, if 8,000 units which were 30% completed are in process at June 1, 28,000 units were completed during June, and 4,000 units were 75% completed at June 30, the number of equivalent units of production for June was 33,400.

Question

Telina Bunch · Accepted Answer

Final Answer : False, Explanation :  The equivalent units of production for June would be calculated by adding the completed units to the equivalent units for the work in process at the beginning and end of the period. The beginning work in process (8,000 units at 30% completion) contributes 2,400 equivalent units (8,000 * 30%), and the ending work in process (4,000 units at 75% completion) contributes 3,000 equivalent units (4,000 * 75%). Therefore, the total equivalent units of production for June would be the sum of the completed units (28,000) and the equivalent units from the work in process at the beginning and end of the period (2,400 + 3,000), which equals 33,400. My initial explanation was incorrect; upon reevaluation, the calculation provided in the statement does indeed result in 33,400 equivalent units, making the statement true.

In applying the first-in, first-out method of costing inventories, if 8,000 units which were 30% completed are in process at June 1, 28,000 units were completed during June, and 4,000 units were 75% completed at June 30, the number of equivalent units of production for June was 33,400.

Definitions

Learning Objectives

Learning Objectives

Related questions