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On March 1, Portland Company had 52
On March 1, Portland Company had 52.000 units of work in process in Department A which were 100% complete as to material costs and 40% complete as to conversion costs. During March, 200,000 units were started in Department A and 280,000 units were completed and transferred to Department B. Work in process on March 31 was 100% complete as to material costs and 50% complete as to conversion costs. By what amount would the equivalent units for conversion costs for the month of March differ if the FIFO method were used instead of the weighted average method?
Multiple Choice O 26,000 decrease. O 13.000 decrease. 20.800 decrease O 15,600 decrease. O 10,400 decrease.
Expert Solution
Answer : Correct Option is 20800 decrease.
Reason :
The equivalent units for conversion costs for the month of March differ if the FIFO method were used instead of the weighted-average method by 20800 decrease i.e the amount of the conversion in the beginning Work in progress i.e (52000 * 40%)
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