Question

? are fill in the blank spots.

(Appendix 6A) First-In, First-Out Method

Benson Pharmaceuticals uses a process-costing system to compute the unit costs of the overthe- counter cold remedies that it produces. It has three departments: mixing, encapsulating, and bottling. In mixing, the ingredients for the cold capsules are measured, sifted, and blended (with materials assumed to be uniformly added throughout the process). The mix is transferred out in gallon containers. The encapsulating department takes the powdered mix and places it in capsules (which are necessarily added at the beginning of the process). One gallon of powdered mix converts into 1,500 capsules. After the capsules are filled and polished, they are transferred to bottling, where they are placed in bottles that are then affixed with a safety seal, lid, and label. Each bottle receives 50 capsules.

During March, the following results are available for the first two departments:

		Mixing		Encapsulating
Beginning inventories:
	Physical units	10 gallons		4,000
Costs:
	Materials	$252		$32
	Labor	$282		$20
	Overhead	?		?
	Transferred in			$140
Current production:
	Transferred out	140 gallons		208,000
	Ending inventory	20 gallons		6,000
Costs:
	Materials	$3,636		$1,573
	Transferred in	—		?
	Labor	$4,618		$1,944
	Overhead	?		?
Percentage of completion:
	Beginning inventory	40%		50%
	Ending inventory	50%		40%

Overhead in both departments is applied as a percentage of direct labor costs. In the mixing department, overhead is 200% of direct labor. In the encapsulating department, the overhead rate is 150% of direct labor.

Required:

1. Prepare a production report for the mixing department using the FIFO method. Round the unit cost to four decimal places. If required, round final answers (except for unit costs) to the nearest dollar or unit.

Benson Pharmaceuticals
Mixing Department Production Report
For the Month of March (FIFO Method)
Unit Information
Units accounted for:
Units in beginning WIP			?
Units started			?
Total units			?
Units accounted for:
		Physical Flow	Equivalent Units
Units started and completed		?	?
Units in BWIP (to complete)		?	?
Units in EWIP		?	?
Total units accounted for		?	?
Cost Information
Costs to account for:
Costs accounted for:
	Transferred Out	Ending Work in Process	Total
Units started and completed	$ ?		$?
Units in beginning WIP:
From prior period	?		?
From current period	?		?
Ending work in process	?	$?	?
Total costs accounted for	$?	$?	$?

2. Prepare a production report for the encapsulating department using the FIFO method. Round the unit cost to four decimal places. If required, round final answers (except for unit costs) to the nearest dollar or unit. Hint: For this department you must convert gallons to capsules. Note: "Total costs to account for" and "Total costs to account for" would be different due to rounding.

Benson Pharmaceuticals
Encapsulating Department Production Report
For the Month of March (FIFO Method)
Unit Information
Units to account for:
Units in beginning WIP				?
Units started				?
Total units accounted for				?
Units to account for:
		Equivalent Units
	Physical Flow	Transferred In	Materials	Conversion
Units started and completed	?	?	?	?
Units in BWIP (to complete)	?	—	—	?
Units in EWIP	?	?	?	?
Total units accounted for	?	?	?	?
Cost Information
Costs to account for:
	Transferred In	Materials	Conversion	Total
Beginning WIP	$?	$?	$?	$?
Incurred during March
Total costs to account for	$?	$?	$?	$?
Equivalent units				—
Cost per equivalent unit	$?	$?	$?	$?
Costs accounted for:
		Transferred Out	Ending WIP:	Total
Units started and completed		$?		$?
Units in BWIP from prior period		?		?
Current period		?		?
Ending work in process:
Transferred in			$?	?
Materials			?	?
Conversion			?	?
Total costs accounted for		$?	$?	$?

Answer 1

2.

Benson Pharmaceuticals
Encapsulating Department Production Report
For the Month of March (FIFO Method)
Unit Information
Units to account for:
Units in beginning WIP				4000
Units started				21000
Total units accounted for				214000
Units to account for:
		Equivalent Units
	Physical Flow	Transferred In	Materials	Conversion
Units started and completed	208000	208000	208000	208000
Units in BWIP (to complete)	6000	6000	6000	6000
Units in EWIP
Total units accounted for	214000	214000	21400	214000 (6000*0.40)
Cost Information
Costs to account for:
	Transferred In	Materials	Conversion	Total
Beginning WIP	$ 140	$ 32	$ 50	$ 222
Incurred during March	17349	1573	4860	23782
Total costs to account for	$ 17489	$ 1605	$ 4910	$ 24004
Equivalent units	214000	214000	214000	—
Cost per equivalent unit	$ 0.0817	$ 0.0075	$ 0.0233	$ 0.1125
Costs accounted for:
		Transferred Out	Ending WIP:	Total
Units started and completed		$ 23400		$ 23400
Units in BWIP from prior period ( 208000*$0.1125)
Current period
Ending work in process:
Transferred in ( 6000*$0.0817 )			$ 490	490
Materials ( 6000* $ 0.0075 )			45	45
Conversion (2400* $ 0.0233)			56	56
Total costs accounted for		$23400	$591	$ 23991 Benson Pharmaceuticals Mixing Department Production Report For the Month of March (FIFO Method) Unit Information Units accounted for: Units in beginning WIP 10 Units started 150 Total units 160 Units accounted for: Physical Flow Equivalent Units Units started and completed 140 140 Units in BWIP (to complete) Units in EWIP 20 10 Total units accounted for 160 150 1. Cost Information Costs to account for: Costs accounted for: Transferred Out Ending Work in Process Total Units started and completed $ 17349 $ 17349 Units in beginning WIP: From prior period From current period Ending work in process $ 1239 1239 Total costs accounted for $17349 $ 1239 $ 18588