Hunter Company adds all materials at the beginning of its manufacturing process. Production information for selected months of the year follows:

Hunter Company adds all materials at the beginning of its manufacturing process. Production information for selected months of the year follows:

 

Requirement 1:

Reconcile the number of physical units worked on during the period.

 

	Beginning								Ending
	Work in Process								Work in Process
			Conversion				Units				Conversion
			Complete		Units		Transferred				Complete
Month	Units		(percent)		Started		Out		Units		(percent)
February	1,900		49		24,600		19,600		6,900		25
June	4,400		65		23,700		24,500		3,600		40
September	2,800		23		25,500		25,500		2,800		59
December	3,000		34		22,100		20,900		4,200		75

 

Requirement 2:

Calculate the number of equivalent units for both materials and conversion for each month.

 

	Equivalent units
Month	Materials		Conversion
February	26,500		21,325
June	28,100		25,940
September	28,300		27,152
December	25,100		24,050

Explanation:

1:

Beginning Inventory + Started = Transferred Out + Ending Inventory

February:  1,900 + Started = 19,600 +6,900

Started = 24,600

June:  4,400 + 23,700 = Transferred + 3,600

Transferred = 24,500

September:  Beginning  + 25,500 = 25,500 + 2,800

Beginning Inventory = 2,800

December:  3,000 + 22,100 = 20,900 + Ending Inventory

Ending Inventory = 4,200

2:

February:

Materials = 19,600 + 6,900 = 26,500 Equivalent Units

Conversion = 19,600 + (6,900 × 25%) = 21,325 Equivalent Units

June:

Materials = 24,500+ 3,600 = 28,100 Equivalent Units

Conversion = 24,500+ (3,600 × 40%) = 25,940 Equivalent Units

September:

Materials = 25,500 + 2,800 = 28,300 Equivalent Units

Conversion = 25,500 + (2,800 × 59%) = 27,152 Equivalent Units

December:

Materials = 20,900 + 4,200 = 25,100 Equivalent Units

Conversion = 20,900 + (4,200 × 75%) = 24,050 Equivalent Units