In: Accounting
(Appendix 6A) FIFO; Production Report
Aztec Inc. produces soft drinks. Mixing is the first department, and its output is measured in gallons. Aztec uses the FIFO method. All manufacturing costs are added uniformly. For July, the mixing department provided the following information:
Production: | ||
Units in process, July 1, 60% complete | 18,000 gallons | |
Units completed and transferred out | 139,000 gallons | |
Units in process, July 31, 55% complete | 24,000 gallons | |
Costs: | ||
Work in process, July 1 | $36,000 | |
Costs added during July | 353,500 |
Required:
Prepare a production report.
Aztec Inc. Mixing Department | |
Production Report | |
For the Month of July (FIFO Method) | |
Unit Information | |
Physical flow: | |
Units to account for: | Units |
Units in beginning WIP | |
Units started | |
Total units to account for | |
Units to account for: | |
Units | |
Units started and completed | |
From beginning WIP | |
Units in ending WIP | |
Total units to account for | |
Equivalent units: | Units |
Started and completed | |
To complete beginning WIP | |
Units in ending WIP | |
Total equivalent units | |
Cost Information | |
Costs to account for: | |
Dollars | |
Costs in beginning WIP | $ |
Costs added by department | |
Total costs to account for | $ |
Cost per equivalent unit | $ |
Costs accounted for: | |
Total | |
Transferred out: | |
Units started and completed | $ |
Units in beginning work in process: | |
From prior period | |
From current period | |
Total cost transferred out | $ |
Goods in ending work in process | |
Total costs accounted for | $ |
Answer-
units to account for | |
Beginning WIP | 18,000 |
Units started [139,000+24,000 - 18,000] | 145,000 |
Units to account for | 163,000 |
Started and completed [139,000 -18,000] | 121,000 |
Beginning WIP | 18,000 |
Ending Inventory | 24,000 |
Units to account for | 163,000 |
Equivalent units:
Started and completed | 121,000 |
Beginning WIP [18,000*.40] | 7,200 |
Ending WIP [ 24,000 * .55] | 13,200 |
Equivalent units | 141,400 |
cost to account for:
Cost of Beginning WIP | 36,000 |
cost added by department | 353,500 |
Total cost to account for | 389,500 |
cost per equivalent units [389,500 /141,400] | $ 2.75 |
units started and completed [121,000 * 2.75] | 332,750 |
units in beginning WIP | |
from prior period | 36,000 |
From current period [18,000*.40 *2.75] | 19,800 |
Total cost transfered out | |
goods in ending WIP [24,000 * .55*2.75] | 36,300 |
Total cost to account for | 388,850 |
**Difference is due decimal places.