[Anonymous]

Here is what i have problem with…

A manufacturing company employs a process cost system. The company’s product passes through both Department 1 and Department 2 in order to be complete, Conversion costs are incurred uniformly throughout the process in Department 2. The direct material is added in Department 2 when conversion is 80% complete. This direct material is a preservative that does not change the volume. Spoiled units are discovered at the final inspection and are recognized then for costing purposes. The physical flow of units for the current month is presented below

Beginning work in process in Department 2

(90% complete with respect to conversion costs) 14,000

Transferred in from Department 1 76,000

Completed and transferred to finished good 80,000

spoiled units—all normal 1,500

Ending work in process in Department 2

(60% complete with respect to conversion costs) 8,500

If the manufacturing company uses the weighted-average method, the equivalent units for direct materials in Department 2 for the current month would be

A. 80,000

B, 90,000

C 67,500

D 81,500

I know the answer is D, but I do not understand why, can anyone please explaint it to me? Is it under W/A method, the Equivalent units of production is just the Completed and transferred to finished good + normal spoilage?

what is difference between Equivalent units of production and Equivalent finished units?