CA Inter P4 · Chapter 9 · Question 6 of 11
Under the FIFO method, equivalent units for conversion in the current period are 16,800 and conversion costs incurred in the current period are ₹5,04,000. The cost per equivalent unit for conversion is:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) ₹30.00
Explanation
Under FIFO, the current period cost is divided by the current period equivalent units: ₹5,04,000 / 16,800 = ₹30 per equivalent unit. The cost of opening WIP brought forward is kept separate and is not included in this rate.
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