Question

Lansing, Inc. provides the following information for one of its department’s operations for June (no new material is added in Department T):

WIP inventory—Department T
Beginning inventory (7,900 units, 20% complete with respect to Department T costs)
Transferred-in costs (from Department S)	$	32,140
Department T conversion costs		8,556
Current work (18,300 units started)
Prior department costs		80,520
Department T costs		164,220

The ending inventory has 2,900 units, which are 60 percent complete with respect to Department T costs and 100 percent complete for prior department costs.

Required: Complete the production cost report using FIFO. (Round "Cost per equivalent unit" to 2 decimal places.)

Answer 1

LANSING INC.
Department T
Production Cost Report - FIFO
For the Month Ended June
Step 1 :Summary of physical units and equivalent units calculation
Units to be accounted for	Physical Units
Units in WIP Inventory,June 1	7900
Units started into production	18300
Total Units to be accounted for	26200
		Equivalent Units
Units accounted for	Physical Units	Prior Department	Department T Costs
Units completed out of June 1 WIP Inventory	7900	0	6320
Units completed out of Units started	15400	15400	15400
Units completed and tranferred out	23300	15400	21720
Units in WIP inventory,June 30	2900	2900	1740
Total Units accounted for	26200	18300	23460
Step 2 : Summary of cost to be accounted for
Cost to be accounted for	Prior Department	Department T Costs	Total
Cost in beginning WIP inventory	$32,140.00	$8,556.00	$40,696.00
Cost incurred during June	$80,520.00	$164,220.00	$244,740.00
Total Cost to be accounted for	$112,660.00	$172,776.00	$285,436.00
Step 3 : Calculation of cost per equivalent unit
	Prior Department	Department T Costs	Total
Cost incurred during June	$80,520.00	$164,220.00	$244,740.00
Total Equivalent units accounted for	18300	23460
Cost per equivalent unit	$4.40	$7.00	$11.40
Step 4 : Assign costs to units transferred out and units in ending WIP Inventory
	Prior Department	Department T Costs	Total
Cost assigned to units transferred out	$99,900.00	$160,596.00	$260,496.00
Cost assigned to units in ending WIP Inventory	$12,760.00	$12,180.00	$24,940.00
Total Costs accounted for	$112,660.00	$172,776.00	$285,436.00