Question

Powers Inc. produces a protein drink. The product is sold by the gallon. The company has two departments: Mixing and Bottling. For August, the bottling department had 67,500 gallons in beginning inventory (with transferred-in costs of $283,000) and completed 202,000 gallons during the month. Further, the mixing department completed and transferred out 257,000 gallons at a cost of $612,000 in August. Required: 1. Prepare a physical flow schedule for the bottling department. Powers Inc. Physical Flow Schedule - Bottling Department For the Month of August Physical flow schedule: Units in beginning work in process 67,500 Units started during the period 257,000 Total units to account for 324,500 Units completed and transferred out: Units started and completed Units completed from beginning work in process 67,500 Units in ending work in process Total units accounted for Feedback Check My Work Review the "How to Calculate the Physical Flow Schedule, Equivalent Units, and Unit Costs with Transferred-In Goods" example in your text. 2. Calculate equivalent units for the transferred-in category. equivalent units 3. Calculate the unit cost for the transferred-in category. If required, round your answer to the nearest cent. nor unit

Answer 1

Answer:

Requirement 1:

Power Inc.

Physical Flow Schedule - Bottling Department

For the month of August

physical Flow Schedule

Units in beginning work in process		67,500
Units started during the period		257,000
Total to be accounted for		324,500
Units completed and transferred out
Units started and completed	134,500
Units completed from beginning work in process	67,500	202,000
Units in ending work in process		122,500
Total units accounted for		324,500

Requirement 2:

Equivalent units for the transferred-in units = 257,000 units

Requirement 3:

Unit cost = $2.38 per unit

Working:

Step 1: (FIFO)

Reconciliation of units

		% already completed	% completed this period
	Units	Mixing	Mixing
Beginning WIP	67,500	100%	0%
Units introduced	257,000
Total units to be accounted for	324,500
Completed and transferred units	202,000	0%	100%
Ending WIP	122,500	0%	100%

Step 2: (FIFO)

Equivalent units

		Mixing
Units transferred:	Total units	% completed this period	Equivalent units
From WIP	67,500	0%	-
From units introduced	134,500	100%	134,500
Total	202,000		134,500

Ending WIP:	Total units	% completed this period	Equivalent units
Total	122,500	100%	122,500
Total EUP	324,500		257,000

Cost incurred in current period (mixing) = $612,000

Total equivalent units = 257,000

Cost per Equivalent unit = $612,000 ÷ 257,000 = $2.38

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Have a great day Champ!

Happy Chegging.