The Converting Department of Tender Soft Tissue Company uses the average cost method and had 2,900 units in work in process that were 70% complete at the beginning of the period. During the period, 36,500 units were completed and transferred to the Packing Department. There were 1,600 units in process that were 20% complete at the end of the period. a. Determine the number of whole units to be accounted for and to be assigned costs for the period. units b. Determine the number of equivalent units of production for the period. units

a) Units to be accounted for

Completed and transferred out = 36,500 units

Closing inventory = 1600 units.

b) Total equivalent units     36,820

Explanation:

Under the weighted average method, the units completed and transferred out are not separated into  opening inventory and newly introduced.

The units to be assigned cost would be as follows:

Completed and transferred out = 36,500 units

Closing inventory = 1600 units.

Equivalent units is the notional whole units which represent incomplete work and her use to assign costs between work-in-progress and completed units.t

Equivalent units= Degree of completion × units

Units                                      units                                 Equivalent units

Completed                          36,500             36,500 × 100% =        36,500

Closing inventory                1,600                   1,600 × 20% =          320

Total equivalent units                                                                     36,820

a) Units to be accounted for

Completed and transferred out = 36,500 units

Closing inventory = 1600 units.

b) Total equivalent units     36,820

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