Problem:
Jackson Electronics Inc. manufactures a variety of microelectronic component parts and utilizes a process costing system. The following information was provided by the accounting department as of July 31, 2014:
- Units started during the month of July totaled 118,200.
- Units partially complete as of July 31 equaled 7,400.
- Ending work in process inventory as of July 31, 2014, was 70 percent complete.
- Direct materials are added at the beginning of the process, and conversion costs are incurred uniformly throughout the process.
- Units in process on July 1, 2014-8,200 units.
Required:
Question: Using the information provided, compute the equivalent units of production for direct materials and conversion costs for July using the average costing method.
Note: Be sure to show how you arrived at your answer.