A-1 products manufacture wooden furniture using an assembly line process. All direct material are introduced at the start of the process, and conversion cost is incurred evenly throughout manufacturing. An examination of the company’s Work-in-Process Inventory for June revealed the following selected information:

Debit side

June 1 balance: 300 units, 30% complete as to conversion, cost $21,300

Production started: 900 units

Direct material used during June: $45,000

June conversion cost: $25,700

Credit side:

Production complete: 700 units

Supplementary records revealed direct-material cost of $15,000 and conversion cost of $6,300.

Conversations with manufacturing personnel revealed that the ending work in process was 60 percent complete as to conversion.

Required:

1. Determine the number of units in the June 30 work-in-process inventory.

2. Calculate the cost of goods completed during June and prepare the appropriate journal entry to record completed production.

3. Determine the cost of the June 30 work-in-process inventory.

4. Briefly explain the meaning of equivalent units. Why are equivalent units needed to properly allocate costs between completed production and production in process?