Charlie Chairs Inc., manufactures plastic moldings for car seats. Its costing sy
ID: 2539446 • Letter: C
Question
Charlie Chairs Inc., manufactures plastic moldings for car seats. Its costing system utilizes two cost categories, direct materials and conversion costs. Each product must pass through Department A and Department B. Conversion costs are allocated evenly throughout production. Data for Department A for February 2017 are: Work in process, beginning inventory, 50% complete for materials, 25% complete for conversion 400 units Units started during February 1,000 units Work in process, ending inventory, 40% complete for materials, 10% complete for conversion 250 units Costs for Department A for February 2017 are: Work in process, beginning inventory: Direct materials $4,500 Conversion costs $17,500 Direct materials costs added during February $10,500 Conversion costs added during February $43,000 How many equivalent units were produced for conversion by Department A during February? A. 1,075 units B. 1,150 units C. 1,000 units D. 750 units
Explanation / Answer
Physical units Materials Conversion Beginning work in process 400 200 300 Units started and completed 750 750 750 Ending work in process 250 100 25 Equivalent units 1400 1050 1075 Equivalent units for conversion by Department A = 1075 units Option A is correct