Question

Required information Problem 16-7AA FIFO: Process cost summary, equivalent units, cost estimates LO C2, C3, C4, P4 The following information applies to the questions displayed below! Dengo Co. makes a trail mix in two departments roasting and blending Direct materials are added at the beginning of each process, and conversion costs are added evenly throughout each process. The company uses the FIFO method of process costing. During October, the roasting department completed and transferred 25,000 units to the blending department. Of the units completed, 4,400 were from beginning inventory and the remaining 20,600 were started and completed during the month. Beginning work in process was 100% complete with respect to direct materials and 30% complete with respect to conversion. The company has 3,800 units (100% complete with respect to direct materials and 70% complete with respect to conversion) in process at month-end Information on the roasting department's costs of beginning work in process inventory and costs added during the month follows Cost Of beginning work in process inventory Added during the month Direct Materials Conversion 11,300 $ 113,490 314,762 1,374,948 Problem 16-7A Part 1 Required: 1. Prepare the roasting department's process cost summary for October using the FIFO method. (Round "Cost per EUP" to 2 decimal places.) Total costs to account for:

Answer 1

Solution:

FIFO
Cost Charged to production
Total Cost of Beginning Work in process	$1,24,790
Total Costs incurred this period	$16,89,708
Total Cost to account for	$18,14,498
Total Cost Accounted for	$18,14,498
*Difference due to rounding cost/unit	$0
Unit Reconciliation
Units to account for:
Units in Beginning work in process	4400
Units Started this period	24400
Total Units to account for	28800
Total units Accounted for:
Units Completed and transferred out	25000
Units in ending work in process	3800
Total Units accounted for	28800
Equivalent units of production (EUP) - FIFO method
	Units	%Material	EUP-Material	% Conversion	EUP- Conversion
Beginning units completed this period (A)	4400	0%	0	70%	3080
Units Started and Completed (450000-100000) (B)	20600	100%	20600	100%	20600
units of Ending work in process (D)	3800	100%	3800	70%	2660
Equivalent units of production (C+D)			24400		26340
Cost per EUP			Material		Conversion
Costs incurred this period (Total Costs)		Costs	$3,14,760	Costs	$13,74,948
/Equivalent units of Production		EUP	24400	EUP	26340
Cost per Equivalent unit of Production			$12.90		$52.20
Cost Assignment and Reconciliation
Beginning Inventory Cost:				$1,24,790
Cost to Complete Beginning Inventory	EUP	Cost per EUP	Total Cost
Direct materials	0	$12.90	$0
Conversion	3080	$52.20	$1,60,776
Total Cost to complete Beginning Inventory				$1,60,776
Total Costs of units in Beginning Inventory				$2,85,566
Cost of units started and completed	EUP	Cost per EUP	Total Cost
Direct Material	20600	$12.90	$2,65,740
Conversion	20600	$52.20	$10,75,320
Total Cost of units started and completed				$13,41,060
Total cost of units transferred out				$16,26,626
Cost of ending work in process	EUP	Cost per EUP	Total Cost
Direct Material	3800	$12.90	$49,020
Conversion	2660	$52.20	$1,38,852
Total Ending work in process				$1,87,872
Total Costs accounted for				$18,14,498

Journal Entry to transfer cost of completed units
31-Oct	Work in Process- Blending Dr	$16,26,626
	To Work in Process -Roasting		$16,26,626