Use the Following Information to Perform the Calculations Requested Below

question 35

Essay

Use the following information to perform the calculations requested below, assuming that the average costing approach to a process costing system is being used.
Beginning work in process inventory: 6,000 units, 100 percent complete as to direct materials, 75 percent complete as to conversion costs
Ending work in process inventory: 18,000 units, 100 percent complete as to direct materials, 65 percent complete as to conversion costs
Units started during the month: 44,000
a. Calculate units completed and transferred out during the month.
b. Calculate units to be accounted for during the month.
c. Calculate equivalent units for conversion costs.
d. Calculate equivalent units for direct materials.

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Definitions:

MRP

Marginal Revenue Product; the additional revenue generated from employing one more unit of a resource or factor of production.

Substitution Effect

The change in demand for a good or service that occurs when its price increases or decreases, leading consumers to substitute it with other goods or services that are relatively more or less expensive.

Output Effect

The impact on the total production of goods and services in an economy resulting from changes in demand, supply, technology, or factors of production.

Factors of Production

The basic inputs used to produce goods and services, including land, labor, capital, and entrepreneurship.