Example (20%)

1- physical flow & equivalent units

* units to be accounted for
Beg. WIP 1,500
Started 8,500
Total 10,000
* units accounted for Material conversion
Good units completed & transferred out 7,000 7,000 7,000
Normal spoilage 750 750 150
Abnormal spoilage 250 250 50
End. WIP 2,000 2,000 1,000
Total 10,000 10,000 8,200

2- Total cost to be acounted for & cost per equivalent units

Material Conversion Total
Cost at the beginning $ 12,000 $ 9,000 $ 21,000
costs incurred $ 76,500 $ 89,100 $ 165,600
Total $ 88,500 $ 98,100 $ 186,600
Equivalent units 10,000 8,200
Cost per equivalent unit $ 8.85 $ 11.96 $ 20.81

3- cost reconciliation schedule

Assignment of costs:
Total Material Conversion
Good units completed & transferred out $ 145,693.90 $ 61,950.00 $ 83,743.90
Normal spoilage $ 8,432.01 $ 6,637.50 $ 1,794.51
Abnormal spoilage $ 2,810.67 $ 2,212.50 $ 598.17
End. WIP $ 29,663.41 $ 17,700.00 $ 11,963.41
Total $ 186,600 $ 88,500 $ 98,100