Department S had 500 units 60% completed in process at the beginning of the period, 9,000 units completed during the period, and 600 units 30% completed at the end of the period.
1. What was the number of equivalent units of production for the period for conversion if the first-in, first-out method is used to cost inventories? Assume the completion percentage applies to both direct materials and conversion cost.

Equivalent Units E.U) are notional whole units which represent incomplete work and are used to apportion costs between between work in progress and completed work.

To compute the EU we d as follows:

Equivalent Units = Degree of completion (%) × units

Items Units Workings E.U

opening inventory 500 500× 40%r 200

Fully worked 8,500 8,500 × 100% 8,500

Closing WIP 600 600 × 30% 180

Total equivalent units 8,880

The total equivalents for conversion cost

= 200 + 8,500 + 180 = 8,880 units

1. DOC for opening inventory is 40% i.e ( 100 -60) .Remember that 60% work has been done in the previous period, so the balance is to be done in this current period

2. Fully work represent the units of inventory introduced in the current period and completed in the same period. Meaning 100% work was achieved in the period.

3. Closing work is only 30% completed. This represent work units that were started this period but not yet completed.