Fleming, Fleming, and Johnson, a local CPA firm, provided the following data for individual returns processed for March (output is measured in number of returns):
Units, beginning work in process —
Units started ................. 6,000
Units completed ............. 5,000
Units, ending work in process (50% complete) ... 1,000
Total production costs .............. $5,500
Required:
1. Prepare a physical flow schedule
2. Prepare an equivalent units schedule. Explain why output is measured in equivalent units.
3. What if EWIP is 80 percent complete? How would this change affect the physical flow schedule? The equivalent units schedule?