Cutting department of Sam limited uses the FIFO method. The following information is gathered from the company
Question:
Cutting department of Sam limited uses the FIFO method. The following information is gathered from the company for December 2019:
Materials | Conversion | |
Opening inventory 5,000 units (% completion) | 100% | 84% |
Equivalent units of production for the department for December | 48,000 | 47,800 |
a). Based on the above information, what can you conclude about at what point in the production process direct materials added in the company’s Cutting Department? (Start, end, evenly throughout the production process).
b). If the ending inventory at December 31 includes 2,100 equivalent units of direct materials and 1,100 equivalent units of conversion, how many units were started and completed by the department during December?
c). Based on all information above (including parts (a) and (b)), compute the percentage completion for conversion for the ending inventory units. [round to whole number]
Managerial Accounting A Focus on Ethical Decision Making
ISBN: 978-0324663853
5th edition
Authors: Steve Jackson, Roby Sawyers, Greg Jenkins