A company uses the FIFO method for inventory costing. At the beginning of a period, the production department had 20,000 units in beginning Work in Process inventory which were 40% complete; the department completed and transferred 165,000 units. At the end of the period, 22,000 units were in the ending Work in Process inventory and are 75% complete. Compute the number of equivalent units produced by the department.

Respuesta :

Answer:

173,500 units

Explanation:

The computation of the number of equivalent units produced by the department is shown below:

= Completed and transferred units × completion percentage + ending work in process units × completion percentage - Beginning work in process units × completion percentage

= 165,000 units × 100% + 22,000 units × 75% - 20,000 units × 40%

= 165000 units - 16,500 units - 8,000 units

= 173,500 units