Question

Sunland Company has the following production data for March: no beginning work in process, units started and completed 32,000, and ending work in process 3,200 units that are 100% complete for materials and 40% complete for conversion costs. Sunland uses the FIFO method to compute equivalent units. If unit materials cost is $4 and unit conversion cost is $13. The total costs to be assigned are $573,440, prepare the cost section of the production cost report for Sunland Company using the FIFO approach.

Answer 1

Sunland Company
Production Cost Report (FIFO)
	Actual Units
Calculation of Physical UNITS:
Units in beginning inventory	0
Units started during the period	35200
Units to be accounted for	35200
	Actual Units	Equivalent Units
		Material	CC
Units Completed and Transferred	32000
From units in beginning inventory	0	0	0
From units started	32000	32000	32000
Units in ending inventory	3200	3200	1280
Equivalent Unit of production	35200	35200	33280
Costs:
	Total	Material	CC
Costs in beginning inventory	0	0	0
Cost added during the year	573440	140800	432640
Total cost to account for	573440	140800	432640
Equivalent Units from above		35200	33280
Cost per equivalent unit	17.00	4.00	13.00
	Total	Material	CC
Cost Accounted for
Units completed and transfer	0	0	0
From units in beginning inventory	-	-	-
From units started	544,000	128,000	416,000
Total Cost of units transferred out	544,000	128,000	416,000
Units in ending inventory	29,440	12,800	16,640
Total Cost Accounted for	573,440	140,800	432,640