RSTN Co. produces its product in two sequential processing departments. During October, the first process finished and transferred 150,000 units of its product to the second process. Of these units, 30,000 were in process at the beginning of the month and 120,000 were started and completed during the month. At month-end, 20,000 units were in process.
Compute the number of equivalent units of production for direct materials for the first process for October under each of the following three separate assumptions using the FIFO method.
1. All direct materials are added to products when processing begins.
2. Beginning work in process inventory is 30% complete for direct materials cost. Ending inventory is 80% complete for direct materials cost.
3. Beginning work in process inventory is 60% complete for direct materials cost. Ending inventory is 20% complete for direct materials cost.
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