Question

FIFO Question: The Rest-a-Lot chair company manufacturers a standard recliner. During February, the firm's Assembly Department started production of 75,000 chairs. During the month, the firm completed 80,000 chairs, and transferred them to the Finishing Department. The firm ended the month with 10,000 chairs in ending inventory. There were 15,000 chairs in beginning inventory. All direct materials costs are added at the beginning of the production cycle and conversion costs are added uniformly throughout the production process. The FIFO method of process costing is used by Rest-a-Lot. Beginning work in process was 30% complete as to conversion costs, while ending work in process was 80% complete as to conversion costs.

Beginning inventory costs:

Direct materials $24,000

Conversion Costs $35,000

Manufacturing costs added during the accouting period:

Direct materials: $168,000

Conversion Costs: $278,000

How many of the units that were started during February were completed during February?

A. 85,000

B. 80,000

C. 75,000

D. 65,000

Answer 1

If you like my explanation, please give a "thumbs up"

Option D $65,000 is the correct answer.

U А B D E F G 1 2 3 Units completed during Feb is the difference between between units started in production and ending inventory 4 Units 5 75000 Particulars Units started production Less: Ending inventory Units started during February were completed during February un 6 -10000 7 65000 8