540 equnits•Equivalent units = 5,940CONVERSION•The beginning WIP is not included in the calculation•5400 units were transferred out•The ending WIP (900 units) is 30% complete →270 equnits•Equivalent units = 5,670Calculated as Units transferred out + Units in ending WIP

Quick Check•Alberts Inc began the current month with 4,000 units 75% complete. Alberts started 15,000 units and completed 14,000 units, leaving 5,000 units in process 30% complete. How many equivalent units of production did Alberts have for the period?

Calculation of Equivalent units under WAM -SMITHMATERIALS•The beginning WIP is not included in the calculation•5400 units were transferred out•The ending WIP (900 units) is 60% complete →540 equnits•Equivalent units = 5,940CONVERSION•The beginning WIP is not included in the calculation•5400 units were transferred out•The ending WIP (900 units) is 30% complete →270 equnits•Equivalent units = 5,670Calculated as Units transferred out + Units in ending WIP

Using the Cost per equivalent unit under WAM -SMITH•Calculation of ending WIP inventory❑Materials 540 equiv units x $21 + Conversion 270 equivalent units x $15 = $15,390•Calculation of costs transferred out, cc = WIP0+ costs added –WIP1c = (6119+3920) + (118621+81130) –15390c = $194,400

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The calculations depend on the methodMethod→WAMFIFOApplicable eq units of productionAll units completed + equivalent units in endinginventoryUnits based on work doneApplicable CostsCosts in beginninginventory + costs added to departmentCosts added to department

Quick Check•Shetty Company uses the weighted-average method in its process costing system. The following information pertains to one of its processing departments for the current month:•All materials are added at the beginning of the process. •The cost per equivalent unit for materialsis closest to: