Beginning work in progress is 4,750 units; 63,900 units completed, and ending work in progress is 6,600 units, which are 100% complete for direct materials and 50% complete for conversion costs. The beginning WIP inventory is 100% complete for direct materials and 50% complete for conversion. What are the equivelant units for materials and conversion using weighted average method? What are the equivalent units for materials and conversion using FIFO method?

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Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.