Question

Jane industries manufactures plastic toys. the company uses the FIFO processing costing system. During October, Janes Fabrication department started work on 10,000 models. During the month, the company completed 11,000 models, and transferred them to the distribution department. The company ended the month with 1500 models in ending inventory. There were 2500 models in beginning inventory. All direct materials costs are added at the beginning of the production cycle and conversion costs are added uniformly throughout the production process.

Beginning work in process was 25% complete as to conversion costs, while ending work in process was 50% complete as to conversion cost.

Beginning Inventory: Direct Materials costs 19,200. Conversion costs 10,800

Manufacturing costs added during the accounting period: Direct Materials Cost 70,000. Conversion costs 240,000.

The FIFO method of process costing is used. CALCULATE the total equivalent units (please show the number of equivalent units started and completed currently) and the costs per equivalent units for direct materials and conversion costs, respectively for the month of october?

	Materials	Conversion
Total Equivalent Units
Cost per Equivalent Unit

Reconcile and assign the costs for both materials and conversion for only Started and Completed Currently

	Materials	Conversion
Started and Completed Currently

Answer 1

• [1]

--Working

EUP - FIFO Method	Units	% Material	EUP Materials	% Conversion	EUP - Conversion
Units of ENDING WIP	1,500	100.0%	1,500	50.0%	750
Units STARTED & COMPLETED	8,500	100%	8,500	100%	8,500
Units of beginning WIP	2,500	0.00%	-	75.00%	1,875
Equivalent Units of Production			10,000		11,125
COST per EUP			Material		Conversion
Cost incurred this period			$          70,000.00		$                  240,000.00
Total Costs		Costs	$          70,000.00	Costs	$                  240,000.00
Equivalent units of production		EUP	10,000	EUP	11,125
Cost per EUP			$             7.00000		$                        21.5730

--Requirement

	Materials	Conversion
Total Equivalent Units	10,000	11,125
Cost per Equivalent Unit	$ 7.00	$ 21.57

• [2]

--Working

Cost of Units started & completed this period:	EUP	Cost per EUP	Total Cost
- Direct Materials	8,500.00	7.00	59,500.00
- Conversion	8,500.00	21.57	183,345.00
Total costs started & Completed this period			242,845.00

--Requirement

	Materials	Conversion
Started and Completed Currently	$ 59500	$ 183345