PE 20-3B Equivalent units of materials cost

The Rolling Department of Keystone Steel Company had 400 tons in beginning work in process inventory (20% complete). During the period, 7,900 tons were completed. The ending work in process inventory was 1,000 tons (30% complete). What are the total equivalent units for direct materials if materials are added at the beginning of the process?


Answer:


Percent 
Total Materials Equivalent 
Whole  Added In  Units for 
Units  Period  Materials 
Inventory in process, beginning of period……………… 400 0% 0 
Started and completed during the period……………… 7,500* 100% 7,500 
Transferred out of Rolling (completed)…………………  7,900 7,500 
Inventory in process, end of period………………………  1,000 100% 1,000 
Total units to be assigned costs…………………………  8,900 8,500 
* 7,900 – 400