QUESTION.
The Chang Manufacturing Company makes wood-finishing stain and uses the FIFO method of process costing for its stain manufacturing activity. The production of stain begins with the blending of various chemicals and ends with the canning of the stain. Canning occurs when the mixture reaches the 90% stage of completion. After canning, the cans are transferred to the shipping department. Here the cans are crated and shipped to various customers. Conversion costs are added uniformly throughout the process. The following are the actual production data for the canning department for April:
April Production Costs
Work in Process, April 1:
Direct materials- chemicals $ 72,000
Direct labour 18,000
Applied overhead 5,000
Costs added in April:
Direct materials-chemicals $336,000
Direct materials- cans 10,000
Direct labour 425,500
Applied overhead 115,000
Units for April:
Work in process inventory, April 1 (25% complete) 8,000 litres
Transferred to shipping department during April 40,000 litres
Started during April 42,000 litres
Work in process inventory, April 30 (80% complete) 10,000 litres
Question is: Compute the equivalent units in April for each of materials-cans, material-chemicals and conversion costs