Gulf Furniture uses a process cost system to account for its chair factory. Beginning inventory consisted of 5,000 units (100% complete as to material, 55% complete as to labor) with a cost of $124,800 materials and $104,500 conversion. 58,000 units were started into production during the month with material costs of $1,537,000 and $2,124,375 of conversion costs. The ending inventory of 6,000 chairs was 100% complete as to materials and 40% complete as to labor. Gulf Furniture uses first-in, first-out (FIFO) costing. Required: a. Compute the equivalent units of production for each input. b. Compute the cost per unit. c. Compute the cost transferred out to finished goods. d. Compute the ending work-in-process inventory balance.
Gulf Furniture uses a process cost system to account for its chair factory. Beginning inventory consisted of 5,000 units (100% complete as to material, 55% complete as to labor) with a cost of $124,800 materials and $104,500 conversion. 58,000 units were started into production during the month with material costs of $1,537,000 and $2,124,375 of conversion costs. The ending inventory of 6,000 chairs was 100% complete as to materials and 40% complete as to labor. Gulf Furniture uses first-in, first-out (FIFO) costing. Required: a. Compute the equivalent units of production for each input. b. Compute the cost per unit. c. Compute the cost transferred out to finished goods. d. Compute the ending work-in-process inventory balance.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Gulf Furniture uses a process cost system to account for its chair factory. Beginning inventory
consisted of 5,000 units (100% complete as to material, 55% complete as to labor) with a cost
of $124,800 materials and $104,500 conversion. 58,000 units were started into production
during the month with material costs of $1,537,000 and $2,124,375 of conversion costs. The
ending inventory of 6,000 chairs was 100% complete as to materials and 40% complete as to
labor. Gulf Furniture uses first-in, first-out (FIFO) costing.
Required:
a. Compute the equivalent units of production for each input.
b. Compute the cost per unit.
c. Compute the cost transferred out to finished goods.
d. Compute the ending work-in-process inventory balance.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F7c7b14be-49be-4193-952a-a6d3f4a18290%2F97f01761-feff-40f3-aedf-cf226fe52ce9%2Fiejcx6o_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Gulf Furniture uses a process cost system to account for its chair factory. Beginning inventory
consisted of 5,000 units (100% complete as to material, 55% complete as to labor) with a cost
of $124,800 materials and $104,500 conversion. 58,000 units were started into production
during the month with material costs of $1,537,000 and $2,124,375 of conversion costs. The
ending inventory of 6,000 chairs was 100% complete as to materials and 40% complete as to
labor. Gulf Furniture uses first-in, first-out (FIFO) costing.
Required:
a. Compute the equivalent units of production for each input.
b. Compute the cost per unit.
c. Compute the cost transferred out to finished goods.
d. Compute the ending work-in-process inventory balance.
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