OK. NEW SET OF SCENARIOS. Let's pretend that you started the period with some inventory -...

 

Transcribed Image Text:

OK. NEW SET OF SCENARIOS. Let's pretend that you started the period with some inventory - 2 million clips that were 40% complete. So, you had to finish them this period. Then you started 10 million more and finished them all. 7. How many whole units worth of paper clips did you do in order to finish the beginning WIP? really do? 8. How many whole units worth of work did you do on the ones you started? 9. So how many total equivalent units? (whole units worth of work). 10. It cost $1 million to do ALL of this, what was the unit cost per clip? Ok ... same scenario as #7: We finished the 2 million in the beginning WIP, started 10 million more. We didn't finish those. We finished 5 million, and had 5 million left which were 50% complete. 11. How many WHOLE units worth of paper clips did you REALLY do in order to finish the beginning WIP? really do? 12. How much whole units worth of work did we do in order to finish the 5 million that we BOTH started AND complete (did both during the period)? 13. How many whole units worth of work (equivalent units) did we do to start the other 5 million that we didn't finish? 14. How many equivalent units worth of paper clips did you really do in total? 15.It cost $1 million to do ALL this, what was the unit cost per clip? OK. NEW SET OF SCENARIOS. Let's pretend that you started the period with some inventory - 2 million clips that were 40% complete. So, you had to finish them this period. Then you started 10 million more and finished them all. 7. How many whole units worth of paper clips did you do in order to finish the beginning WIP? really do? 8. How many whole units worth of work did you do on the ones you started? 9. So how many total equivalent units? (whole units worth of work). 10. It cost $1 million to do ALL of this, what was the unit cost per clip? Ok ... same scenario as #7: We finished the 2 million in the beginning WIP, started 10 million more. We didn't finish those. We finished 5 million, and had 5 million left which were 50% complete. 11. How many WHOLE units worth of paper clips did you REALLY do in order to finish the beginning WIP? really do? 12. How much whole units worth of work did we do in order to finish the 5 million that we BOTH started AND complete (did both during the period)? 13. How many whole units worth of work (equivalent units) did we do to start the other 5 million that we didn't finish? 14. How many equivalent units worth of paper clips did you really do in total? 15.It cost $1 million to do ALL this, what was the unit cost per clip?

Answer rating: 100% (QA)

Answer To solve these problems we can use the concept of equivalent units in accounting Equivalent u... View the full answer