Question

Saved Required information The following information applies to the questions displayed below.] Tamar Co. manufactures a single product in two departments. All direct materials are added at the beginning of the Forming process. Conversion costs are added evenly throughout the process. During May, the Forming department started 22,950 units, and transferred 23,700 units of product to the Assembly department. Its 3,300 units of beginning work in process consisted of $93,945 of direct materials and $457,446 of conversion costs. It has 2550 units (100% complete with respect to direct materials and 80% complete with respect to conversion) in process at month-end. During the month, $525,555 of direct materials costs and $2,605,614 of conversion costs were charged to the Forming department. The following additional Information is available for the Forming department Beginning work in process consisted of 3,300 units that were 100% complete with respect to direct materials and 40% complete with respect to conversion . Of the 23,700 units transferred out, 3,300 were from beginning work in process. The remaining 20,400 were units started and completed during May. Assume that Tamar uses the FIFO method to account for its process costing system, 1. Prepare the Forming department's process cost summary for May using the FIFO method. (Round "Cost per EUP" to 2 decimal places.) Total costs to account for: 0 Total costs to account for Total costs accounted for 7 < Prev 8 of 8 !!! Next > search O ai

Answer 1

*FIFO:
*It assigns the cost of the previous period's equivalent units in beginning WIP to the first units completed and transferred out of the process, and assigns the cost of equivalent units worked on during the current period first to complete beginning inventory, Then to start and complete new units, and finally to units in Ending WIP inventory.
*FIFO costing method is that work done on beginning inventory before the current period is kept
separate from work done in the current period.
*Equivalent units in Beginning WIP + Equivalent units of work done in current period = Equivalent units in Beginning WIP + Equivalent units completed and transferred out in current period + Equivalent units in Ending WIP.

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FIFO Step1 Total Costs to account for: Cost of Beginning WIP Cost Incurred this period Total Cost to account for: Total Cost to account for: Difference due to rounding off $ 551,391 $3,131,169 $3,682,560 $ 3,682,560 $ Step2 Unit Reconcilation Beginning WIP Units Started Total units accounted for: Units Completed and Transferred out Ending WIP Total units accounted for: 3,300 22,950 26,250 23,700 2,550 26,250 Step3 Equivalent units of production Particulars Beginning WIP Completed (8700-1300) Ending WIP Total UNITS Units 3,300 20,400 2,550 26,250 % of Material EUP-Material%Conversion EUP -Conversion cost 0% 60% 1,980 100% 20,400 100% 20,400 100% 2,550 80% 2,040 22,950 24,420

$ Step4 Cost per Equivalent unit of production Costs incurred this period Total Costs Div, Equivalent units Cost per Equivalent unit of production $ $ $ Costs EUP 525,555 525,555 22,950 22.90 Costs EUP 2,605,614 2,605,614 24,420 106.70 $ $ $ 551,391 EUP Cost per EUP Total costs $ 1,980 $ 22.90 $ 106.70 $ 211,266 $ $ 211,266 762,657 Step 5 Total costs accounted for: Beginning Inventory Cost Cost of units transferred out: Cost to complete beginning inventory: Direct Material Conversion cost Total Costs to complete beginning inventory Total Costs of units in beginning inventory Cost of units Started and Completed : Direct Material Conversion cost Total Costs of units in beginning started and completed Total Costs of units transferred out Cost to Ending WIP: Direct Material Conversion cost Total Costs of Ending WIP Total costs accounted for 20,400 $ 20,400 $ 22.90 $ 106.70 $ 467,160 2,176,680 $ 2,643,840 $ 3,406,497 EUP Cost per EUP 2,550 $ 22.90 2,040 $ 106.70 Total costs $ 58,395 $ 217,668 $ 276,063 $ 3,682,560

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