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Acc650 t2

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Analysis of Physical flow of units Every unit was either in the beginning of the inventory or ending inventory, ending and beginning inventory must be equal. BI Units completed Sums 10,000 100,000 110,000 EI Units completed 30,000 80,000 110,000 There are 100,000 units started, 30,000 incomplete that leaves 70,000 units as the started and finished during the month of April. Since there was 10,000 at the beginning of the inventory, a total of 80,000 units were completed during the period. Calculation of equivalent units First of all, lets begin with the beginning inventory, at 20% conversion rate, the materials worth of conversion of 2,000 units. So we can say that 2,000 units are our equivalent worth of units. Computation of unit costs Beginning inventory Costs incurred Total Direct Materials $ 22,000 $ 198,000 $ 220,000 Conversion Total $ 4,500 $ $ 158,400 $ $ 162,900 Units Completed Direct Materials Conversion 80,000 80,000 26,500 356,400 Equivalents units in EI Total 30,000 110,000 10,000 There is 33.333% conversion rate of the direct materials 90,000 Average costs Direct Materials Conversion Costs $ 220,000 $ 162,900 Equivalent units in EI 110,000 90,000 Cost per equivalent unit $ 2.00 $ 1.81 Total Costs Units transferred out Total cost per unit Completed units Total $ $ 3.81 80,000 304,800 Ending inventory Direct Materials Conversion Equivalent units in EI 30000 10,000 Cost per equivalent unit $ 2.00 $ 1.81 Total $ 60,000 $ 18,100 $ Total costs $ 78 ...
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