Suppose That a Company Adds Material at the Beginning of Production

question 87

Multiple Choice

Suppose that a company adds material at the beginning of production and that conversion costs are incurred evenly throughout production. In May, the beginning work in process inventory was 20% complete and the ending work in process inventory was 30% complete. Under the FIFO method, the number of equivalent units of production for conversion costs for May is equal to the number of units

• A) Started in May
• B) Started and completed in May plus 30% times the number of units in ending inventory for May
• C) Started and completed in May plus 20% times the number of units in beginning inventory plus 30% times the number of units in ending inventory for May
• D) Started and completed in May plus 80% times the number of units in beginning inventory plus 30% times the number of units in ending inventory for May