Farwars the question above is #1090 in ninja mcq.
Because beginning inventory is 0, the question doesn't need to specify FIFO or Wtd Avg – all costs were incurred in this period. It does require you to calculate equivalent units for Materials and Conversion Costs to determine the costs applied to the units transferred out.
100% of materials are added at beginning so the EU for materials is calculated as 13,500 transferred out + 1500 ending inv = 15,000 EU. 75,000/15,000 = $5 unit materials cost
Ending inventory of 1,500 units are only 25% complete for conversion costs and 13,500 were transferred out and they were 100% complete. The number of EU for Conv Costs = 13,500 + .25(1500)= 13,875, and $55,500/13,875 = $4 unit.
Now you have costs per equivalent unit for Materials and Conv costs. Units transferred out had a total cost of $5 + $4 = $9. $9 * 13,500 units transferred out = $121,500
Yep, that is BEC in a nutshell
FAR 7/25/15 76!
AUD 10/30/15 93
BEC 2/27/16 82
REG 5/23/16 88!
Ninja Book and MCQ and the forum - all the way!!!
and a little thing i like to call, time and effort!
if you want things to change, you have to do something different