ECONOMICS

Detailed explanation-1: -Barnes and Miller Manufacturing is trying to determine the equivalent units for conversion costs with 10, 000 units of ending work in process at 80% completion and 32, 000 physical units. There are no beginning units in the department. Conversion costs occur evenly throughout the entire production period.

Detailed explanation-2: -20, 000 units in a process that are 70% complete are referred to as: 14, 000 equivalent units of ending work in process. A process with no beginning work in process, completed and transferred out 85, 000 units during a period and had 50, 000 units in the ending work in process inventory that were 30% complete.

Detailed explanation-3: -Equivalent units are the estimated number of units worked on during the period. They are computed by multiplying the physical units by the percentage worked on during the period.

Detailed explanation-4: -The equivalent units are calculated to account for work-in process inventory and the percentage completion with respect to material costs and conversion costs. The conversion cost is defined as the sum of direct labor cost and overhead cost.