Question

Information for the Nichols Manufacturing Company for the month of May is as follows: Beginning work in process: Cost of Inventory at process, May 1 $5,010 Units, 800 Direct materials, 100% complete Conversion costs, 70% complete Units started in May, 14,000 Ending work in process inventory: Costs charged to Work in Process during May : Units, 1,500 Direct materials costs, $57,400 Direct materials, 100% complete Direct labor costs, $20,049 Conversion costs, 30% complete Factory overhead costs, $30,073 Prepare a cost of production report for the month of May, using the FIFO method. Round your cost per equivalent unit amounts to two decimal places. Round all other amounts to the nearest dollar. If an amount is zero enter answer as "0".

Answer 1

• Production Cost Report sample [Working is given after the report]

	Physical Units	Direct Material	Conversion Cost [Labor cost + Overhead]
Flow of Units:
Units to be accounted for:
Beginning WIP inventory	800
Units started this period	14,000
Total Units to account for	14,800
Units accounted for:
Completed & Transferred out
From Beginning WIP Inventory	800
Direct Material		-
Conversion Cost [Labor cost + Overhead]			240
Started & Completed currently	12,500	12,500	12,500
Units in Ending WIP Inventory	1,500
Direct Material		1,500
Conversion Cost [Labor cost + Overhead]			450
Total units accounted for	14,800	14,000	13,190
	TOTAL	Direct Material	Conversion Cost [Labor cost + Overhead]
Flow of Costs:
Cost of be accounted for:
Costs in beginning WIP Inventory	$                         5,010.00	$                        -	$                         -
Current Period Costs	$                     107,522.00	$        57,400.00	$          50,122.00
Total Cost to be accounted for	$                     112,532.00	$        57,400.00	$          50,122.00
Cost per Equivalent units
Direct Material		$                   4.10
Conversion Cost			$                    3.80
Costs accounted for:
Costs assigned to units transferred out:
Costs from beginning WIP Inventory	$                         5,010.00	$                        -	$                         -
Current Costs added to complete beginning WIP Inventory	$                             912.00
Direct Material		$                        -
Conversion Cost			$                912.00
Current Costs of units started and completed:	$                       98,750.00
Direct Material		$        51,250.00
Conversion Cost			$          47,500.00
Total cost transferred out	$                     104,672.00	$        51,250.00	$          48,412.00
Cost of ending WIP Inventory	$                         7,860.00
Direct Material		$           6,150.00
Conversion Cost			$            1,710.00
Total costs accounted for	$                     112,532.00	$        57,400.00	$          50,122.00

--Working

EUP - FIFO Method	Units	% Material	EUP Materials	% Conversion	EUP - Conversion
Units of ENDING WIP	1,500	100%	1,500	30%	450
Units STARTED & COMPLETED	12,500	100%	12,500	100%	12,500
Units of beginning WIP	800	0.00%	-	30.0%	240
Equivalent Units of Production			14,000		13,190
COST per EUP			Material		Conversion
Cost incurred this period			$          57,400.00		$                    50,122.00
Total Costs		Costs	$          57,400.00	Costs	$                    50,122.00
Equivalent units of production		EUP	14,000	EUP	13,190
Cost per EUP			$             4.10000		$                        3.80000
COST ASSIGNMENT & RECONCILIATION
Cost Transferred out:	EUP	Cost per EUP	Total Cost
Cost of Beginning WIP			$            5,010.00
Cost to complete beginning WIP-
- Direct Materials	-	$                   4.10	$                         -
- Conversion	240	$                   3.80	$                912.00
Total cost to complete beginning WIP			$            5,922.00
Cost of Units started & completed this period:	EUP	Cost per EUP	Total Cost
- Direct Materials	12,500	$                   4.10	$          51,250.00
- Conversion	12,500	$                   3.80	$          47,500.00
Total costs started & Completed this period			$          98,750.00
Total cost of work finished this period				$      104,672.00
Costs of Ending WIP:	EUP	Cost per EUP	Total Cost
- Direct Materials	1,500	$                   4.10	$            6,150.00
- Conversion	450	$                   3.80	$            1,710.00
Total cost of ending WIP				$           7,860.00
Total costs accounted for				$      112,532.00