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Assignment Essay

Satisfactory Essays

Chapter 3 Exercise E9: Assigning Costs: FIFO Costing Method
The Bakery produces cupcakes. It uses a process costing system. In March, its beginning inventory was 450 units, which were 100% complete for direct materials costs and 10% complete for conversion costs. The cost of beginning inventory was $655. Units started and completed during the month totaled 14,200. Ending inventory was 410 units, which were 100% complete for direct materials costs and 70% complete for conversion costs. Costs per equivalent unit for March were $1.40 for direct materials costs and $1.00 for conversion costs. Using the FIFO costing method, compute the cost of goods transferred to the Finished Goods Inventory account, the cost remaining in the Work in Process …show more content…

From the information in the process cost report, identify the amount that should be transferred out of the Work in Process Inventory account, and state were those dollars should be transferred. $116,196 should be transferred to Finished Goods Inventory.

3. Repeat requirements 1 and 2 for August.

Physical Units
Beginning Inventory
3050
Units started this period
32,800
Units to be accounted for
35,850
Beginning inventory
3,050
Units started and completed
29,200
Ending inventory
3,600
Units accounted for
35,850

Equivalent Units
Direct Material
Conversion Costs
-
0%
1220
40%
29200
100%
29,200
100%
3600
100%
1,800
50%
32,800

32,220

Current Costs
=
66,912
54774
Equivalent Units
=
32,800
32,220

Cost per equivalent unit
$3.74 =
$2.04 +
$1.70

Cost of goods manufactured and transferred out:

From beginning inventory
$9,455

Current costs to complete

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