# (solution) Question: Hello the following question I am struggling with. I

Question:

Hello the following question I am struggling with. I know the answer since it is given to me but for the CONVERSION EQUIVALENT UNITS 47,200 at the bottom. I can not figure out how they calculated this number. Can someone please give me a step by step on how this 47,200 is calculated please?

Thanks

THE FOLLOWING INFORMATION APPLIES TO QUESTIONS 42 THROUGH 47.

Craft Concept manufactures small tables in its Processing Department. Direct materials are added at the initiation of the production cycle and must be bundled in single kits for each unit. Conversion costs are incurred evenly throughout the production cycle. Before inspection, some units are spoiled due to nondetectible materials defects. Inspection occurs when units are 50% converted. Spoiled units generally constitute 5% of the good units. Data for December 20×3 are as follows:

WIP, beginning inventory 12/1/20×3 10,000 units

Direct materials (100% complete)

Conversion costs (75% complete)

Started during December 40,000 units

Completed and transferred out 12/31/20×3 38,400 units

WIP, ending inventory 12/31/20×3 8,000 units

Direct materials (100% complete)

Conversion costs (65% complete)

Costs for December:

WIP, beginning Inventory:

Direct materials \$ 50,000

Conversion costs 30,000

42. What is the number of total spoiled units?

a. 1,600 units

b. 2,000 units

c. 2,700 units

d. 3,600 units

Answer: d Difficulty: 2 Objective: 2

Spoiled units = (10,000 units + 40,000) – (38,400 units + 8,000) = 3,600 units

43. Normal spoilage totals

a. 1,600 units.

b. 2,000 units.

c. 1,920 units.

d. 2,700 units

Answer: c Difficulty: 2 Objective: 2

Normal spoilage = 5% x 38,400 units = 1,920 spoiled units

44. Abnormal spoilage totals

a. 1,600 units.

b. 2,000 units.

c. 1,680 units.

d. 1,920 units.

Answer: c Difficulty: 3 Objective: 2

Abnormal spoilage = 3,600 units – 1,920 units = 1,680 units

45. What is the total cost per equivalent unit using the weighted-average method of process costing?

a. \$3.00

b. \$3.60

c. \$6.60

d. \$4.60

Answer: c Difficulty: 2 Objective: 3

Direct Materials Conversion Costs

WIP, beginning inventory \$ 50,000 \$ 30,000

Costs added during period 100,000 140,000

Total cost to account for 150,000 170,000

Divide by equivalent units 50,000 47,200

Equivalent-unit costs \$ 3.00 \$ 3.60

Total cost per equivalent unit = \$3.00 + \$3.60 = \$6.60

Beginning WIP
Tables Started
Table to Account for Physical Unit Direct Material Conversion Cost
10000
40000
50000 Beginning Inventory
Started And Completed
Total Table Completed 10000
28400
38400…