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Carmelita Inc. has the following information available: Costs from Beginning Inventory Costs from Current Period Direct...

Carmelita Inc. has the following information available:

Costs from Beginning Inventory Costs from Current Period
Direct materials $4,800 $28,900
Conversion costs 6,600 150,900

At the beginning of the period, there were 600 units in process that were 42% complete as to conversion costs and 100% complete as to direct materials costs. During the period, 4,600 units were started and completed. Ending inventory contained 400 units that were 30% complete as to conversion costs and 100% complete as to materials costs. Assume that the company uses the FIFO process cost method. Round cost per unit figures to the nearest cent when calculating total costs.

The total costs transferred into Finished Goods for units started and completed were

a.$163,576

b.$177,800

c.$231,140

d.$114,503

Solutions

Expert Solution

Solution:

Carmelita Inc.
Computation of Equivalent unit (FIFO)
Particulars Physical units Material Conversion
Units to be accounted for:
Beginning WIP Inventory 600
Units started this period 5000
Total unit to be accounted for 5600
Units Accounted for:
Units completed and transferred out
From beginning inventory
Material - 0%
Conversion - 58%		 600 0 348
Started and completed currently 4600 4600 4600
Transferred to finished goods 5200 4600 4948
Units in ending WIP
Material - 100%
Conversion - 30%		 400 400 120
Total units accounted for 5600 5000 5068
Carmelita Inc.
Computation of Cost per Equivalent unit
Particulars Total cost Material Conversion
Current period cost $179,800.00 $28,900.00 $150,900.00
Equivalent units 5000 5068
Cost per equivalent unit $5.78 $29.78

Cost of units started and completed during the period = 4600 * ($5.78 + $29.78) = $163,576

Hence option a is correct.

ekkarill92 answered 2 years ago
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