Holly Company has the following information for December 1 to December 31. All direct materials are 100% complete.

Work-in-Process
Beginning balance December 280 units, 20% complete for conversion	$ 35,000	Completed 880 units and transferred to finished goods inventory	$ 179,558
Direct materials	75,600
Direct labor	47,600
Factory overhead
Property taxes	7,600
Depreciation	36,000
Utilities	19,600
Indirect labor	5,600
Ending balance December 31, 380 units, 40% complete	47,442

Required:

1. Calculate equivalent units using the weighted-average and FIFO methods.

2. Use the given information to determine whether Holly Company is using the FIFO or weighted-average method. The beginning balance of Work-in-Process (WIP) consists of $18,999 of direct materials and $16,001 of conversion costs.

multiple choice

• Weighted-average method

• FIFO method