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		300
Percent complete with respect to materials		60	%
Percent complete with respect to conversion		10	%
Costs in the beginning inventory:
Materials cost	$	570
Conversion cost	$	2,132
Units started into production during the month		24,000
Units completed and transferred out		24,000
Costs added to production during the month:
Materials cost	$	60,075
Conversion cost	$	638,352
Work in process, ending:
Units in process		300
Percent complete with respect to materials		70	%
Percent complete with respect to conversion		70	%

Required:

Using the FIFO method:

a. Determine the equivalent units of production for materials and conversion costs.

b. Determine the cost per equivalent unit for materials and conversion costs.

c. Determine the cost of ending work in process inventory.

d. Determine the cost of units transferred out of the department during the month.

Answer 1

Answer

a. The equivalent units of production for materials and conversion costs using FIFO method.b.Calculating the cost per equivalent unit for materials and conversion costsc. Calculating the cost of ending work in process inventory.d.Calculating the cost of units transferred out of the department during the month.