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A department adds raw materials to a process at the beginning of the process and incurs
conversion costs uniformly throughout the process. For the month of January, there were no units
in the beginning work in process inventory; 80,000 units were started into production in January;
and there were 20,000 units that were 40% complete in the ending work in process inventory at
the end of January. What were the equivalent units of production for conversion costs for the
month of January?
Solution
Calculation of Equivalent Units of Production for Conversion Cost:
Equivalent units for Conversion Costs for the month of January: 60,000 + 8,000 = 68,000
Units
Units
Units Started in January 80,000
Units Completed 60,000
Ending Work in Process 20,000
Completion Level 40%
Equivalent Units in Ending Work in Process(20,000 x 40%) 8,000

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  • 1. A department adds raw materials to a process at the beginning of the process and incurs conversion costs uniformly throughout the process. For the month of January, there were no units in the beginning work in process inventory; 80,000 units were started into production in January; and there were 20,000 units that were 40% complete in the ending work in process inventory at the end of January. What were the equivalent units of production for conversion costs for the month of January? Solution Calculation of Equivalent Units of Production for Conversion Cost: Equivalent units for Conversion Costs for the month of January: 60,000 + 8,000 = 68,000 Units Units Units Started in January 80,000 Units Completed 60,000 Ending Work in Process 20,000 Completion Level 40% Equivalent Units in Ending Work in Process(20,000 x 40%) 8,000