In process costing system how the percent complete with respect to conversion cost is calculated?
Percentage Complete
Answers
Simplistic View
Total (estimate) all OA for a given period/year. Divide by number of units to be produced. You now have conversion cost per unit. Add DL.
OR
Total (estimate) DL+OA for given period/year. Divide by number of units to be produced.
2
Thanks for your reply. What is the meaning of "OA". and how the same can be used to calculate equivalent units of production.
OA is overhead application (rate).
Same calculation. You figure what the EUP is, and apply Conversion cost, which is calculated on a finished item.
EUP is an estimate of what percent complete the process is in (WIP).
Might I suggest you review your cost
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