Exercise 3-5 (Video)

In Shady Company, materials are entered at the beginning of each process. Work in process inventories, with the percentage of work done on conversion costs, and production data for its Sterilizing Department in selected months during 2020 are as follows.

		Beginning Work in Process						Ending Work in Process
Month		Units		Conversion Cost%		Units Transferred Out		Units		Conversion Cost%
January		0				11,000		2,000		60
March		0				12,000		3,000		30
May		0				14,000		7,000		80
July		0				10,000		1,500		40

Compute the physical units for January and May.

		January		May
Units to be accounted for
Beginning work in process
Started into production
Total units
Units accounted for
Transferred out
Ending work in process
Total units

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Compute the equivalent units of production for (1) materials and (2) conversion costs for each month.

		Materials		Conversion Costs
January
March
May
July

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