What is the total equivalent units of goods in work in process inventory on 30 Nov 2024 as to direct materials?
Understand the Problem
The question is asking for the calculation of the total equivalent units of goods in work in process inventory for direct materials as of 30 Nov 2024. In a process costing system, equivalent units measure the work done during a period, expressed in fully completed units. Since all direct materials are added at the beginning of the process, we need to calculate the equivalent units for the 3,800 units in work in process on 30 Nov 2024, which are fully accounted for in terms of direct materials.
Answer
3,800 units
Answer for screen readers
The total equivalent units of goods in work in process inventory for direct materials as of 30 Nov 2024 is 3,800 units.
Steps to Solve
- Identify Total Units in Process
First, we note the number of units in work in process inventory, which is given as 3,800 units.
- Understand Equivalent Units for Direct Materials
In a process costing system, since all direct materials are added at the beginning of the process, all units in the work in process inventory are considered to be fully complete regarding direct materials.
- Calculate the Equivalent Units for Direct Materials
Since all 3,800 units are fully processed in terms of direct materials, we can state that the equivalent units are equal to the total units in process.
The equivalent units for direct materials are calculated as: $$ \text{Equivalent Units} = \text{Total Units in Process} = 3,800 \text{ units} $$
The total equivalent units of goods in work in process inventory for direct materials as of 30 Nov 2024 is 3,800 units.
More Information
In process costing, understanding equivalent units is important for accurately determining costs associated with production. All direct materials are added at the start of the production process, which simplifies the calculation of equivalent units since all units in process are considered complete in terms of direct material.
Tips
- Confusing the concept of equivalent units with units that are incomplete; remember that for direct materials, if they are added at the beginning, all units are fully accounted for.
- Not properly identifying the total units that are in work in process; make sure to use the correct number provided in the problem.
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