Question

Daosta Inc. uses the FIFO method in its process costing system. The following data concern the operations of the company's first processing department for a recent month.

Work in process, beginning:
Units in process		900
Percent complete with respect to materials		40	%
Percent complete with respect to conversion costs		20	%
Costs in the beginning inventory:
Materials cost	$	530
Conversion cost	$	2108
Units started into production during the month		16,000
Units completed and transferred out		16,000
Costs added to production during the month:
Materials cost	$	32,180
Conversion cost	$	416,512
Work in process, ending:
Units in process		900
Percent complete with respect to materials		50	%
Percent complete with respect to conversion costs		70	%

Required:

Using the FIFO method:

Equivalent Units of Production for Direct materials	(Do not enter commas in answer for example 5,000 should be entered as 5000)
Equivalent Units of Production for Conversion Costs	(Do not enter commas in answer for example 5,000 should be entered as 5000)
Cost per Equivalent Unit – Direct Materials	$ (Round to 2 decimal places)
Cost per Equivalent Unit – Conversion Costs	$ (Round to 2 decimal places)
Total value of Ending Work in Process	$.00 (Round to the nearest whole dollar and do not enter dollar signs or commas in answer for example $5,000 should be entered as 5000)
Total value of units transferred out	$.00 (Round to the nearest whole dollar and do not enter dollar signs or commas in answer for example $5,000 should be entered as 5000)

Answer 1

Using the FIFO method:

Equivalent Units of Production for Direct materials	(900*60%+15100+900*50%) = 16090
Equivalent Units of Production for Conversion Costs	(900*80%+15100+900*70%) = 16450
Cost per Equivalent Unit – Direct Materials	32180/16090 = 2
Cost per Equivalent Unit – Conversion Costs	416512/16450 = 25.32
Total value of Ending Work in Process	450*2+630*25.32 = 16852
Total value of units transferred out	(15640*2+15820*25.32+2638) = 434480