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Managerial Accounting

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Calculating Equivalent Units: Medic's Inc.

MGRACT-HKH417

Medic's Incorporated produces an over-the-counter pain medication. Materials are added in two stages - at the beginning of the process and at 50% complete. Conversion costs are added uniformly throughout the production process. Beginning work-in-process had 200,000 units that were 100% complete for materials and 80% complete for conversion costs.

Medic's Inc., completed 500,000 units and transferred them to finish goods, and left 100,000 units in ending work-in-process.

Using the weighted-average process costing method, how many equivalent units of production did Medic Inc. have, assuming that the 100,000 units in ending work-in-process inventory were 50% complete for direct materials and 40% complete for conversion costs for Direct Materials and Conversion Costs?