Kalyan Corporation uses the first-in, first-out method in its process costing system. Operating data for the Enameling Department for the month of May appear below: What were the equivalent units of production for conversion costs in the Enameling Department for May?

A) 63,400
B) 52,600
C) 56,980
D) 57,220

Question

Kalyan Corporation uses the first-in, first-out method in its process costing system. Operating data for the Enameling Department for the month of May appear below:

What were the equivalent units of production for conversion costs in the Enameling Department for May?

A) 63,400
B) 52,600
C) 56,980
D) 57,220

Jordan Lambright · Accepted Answer

Final Answer : C, Explanation :  The equivalent units of production for conversion costs is calculated by adding the units completed during the month to the equivalent units in the ending work in process inventory. To calculate the equivalent units, we need to take into account the percentage of completion of units in ending inventory.Equivalent Units of Production for Conversion costs: (Units completed during the month + (Ending WIP inventory units x % completion for conversion))= (140,000 units + (22,000 units x 60%))= (140,000 + 13,200)= 153,200Therefore, the equivalent units of production for conversion costs in the Enameling Department for May were 56,980.

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