Question

The Laramie Factory produces expensive boots. It has two departments, tanning and finishing departments, which process all the items. During January, the beginning work in process in the tanning department was 40% complete as to conversion and 100% complete as to direct materials. The beginning inventory included $6,000 for materials and $18,000 for conversion costs. Ending work-in-process inventory in the tanning department was 40% complete. Direct materials are added at the beginning of the process. Beginning work in process in the finishing department was 60% complete as to conversion. Beginning inventories included $7,000 for transferred-in costs and $10,000 for conversion costs (no direct materials are required for finishing department). Ending inventory was 30% complete. Additional information about the two departments follows:

	Tanning	Finishing
Beginning work-in-process units	5,000	4,000
Units started this period	14,000
Units transferred out this period	16,000	18,000
Ending work-in-process units		2,000
Material costs added	$18,000
Conversion costs	32,000	$19,440
Transferred-out cost	48,000

Required: Complete the production cost worksheet below using FIFO costing for the finishing department.

Finishing Department

FIFO Method (excel template is provided)

Flow of production		Physical Units	Trans-In	Conversion
Work in process, beginning
Transferred in during period
To account for
Completed and Transferred out
During current period
From Beg. WIP
Start and Complete
Work in process, ending
Accounted for work done in current only
Costs		Totals	Trans-In	Conversion
Work in process, beginning
Costs added during period
Total costs to account for
Costs added in current
Divided by equivalent units
Equivalent-unit costs
Assignment of costs
Completed and transferred out
WIP, beg
Costs added to beg. WIP in current
Total from beg.
Started and completed
Total costs of comp. & transf. out
Work in process, ending
Total costs accounted for

Answer 1

Answer is given below