LDR Manufacturing produces a pesticide chemical and uses process - 14261

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yousafbhutta

yousafbhutta

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  • From: Business,
  • Posted on: Sun 07 Oct, 2012
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Request Description

LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2012, the first department, Mixing, had a zero balance. During January, 40,000 liters of chemicals were started into production. During the month, 32,000 liters were completed, and 8,000 remained in process, partially completed. In the Mixing Department, all raw materials are added at the beginning of the production process, and conversion costs are applied evenly through the process.

 

At the end of the month, LDR calculated equivalent units. The ending inventory in the Mixing Department was 60% complete with respect to conversion costs. With respect to conversion costs, how many equivalent units were calculated for the product that was completed, and how many equivalent units were calculated for the ending balance?

  • 40,000 equivalent units and 8,000 equivalent units
  • 32,000 equivalent units and 4,800 equivalent units
  • 19,200 equivalent units and 8,000 equivalent units
  • 32,000 equivalent units and 4,800 equivalent units
Solution Description

 

LDR Manufacturing produces a pesticide chemical and uses process costing. There are three processing departments-Mixing, Refining, and Packaging. On January 1, 2012, the first department, Mixing, had a zero balance. During January, 40,000 liters of chemicals were started into production. During the month, 32,000 liters were completed, and 8,000 remained in process, partially completed. In the Mixing Department, all raw materials are added at the beginning of the production process, and conversion costs are applied evenly through the process.