Explanation First in and first out (FIFO) method: Under this method cost of units sold and units lying as ending inventory is ascertained on the first in and first out basis. It means units entered in the store first would be sold out first. Prepare a production cost report for June for the Blending Department. E Products Blending Department Production Cost Report Particulars Physical units Prior department Materials Conversion Beginning work-in-process inventory 9,000 Units started this period 116,000 Total units 125,000 Completed and transferred out Beginning work-in-process inventory 9,000 - 9,000 6,300 (70%) Started and currently completed 106,000 106,000 106,000 106,000 Units in ending work-in-process inventory 10,000 10,000 10,000 (100%) 6,000 (60%) Total units 125,000 116,000 125,000 118,300 Table: (1) Compute the cost per equivalent unit of prior department, materials, and conversion: Particulars Total Prior department Materials Conversion Costs in beginning work-in-process inventory $ 28,875 $ 10,540 $ 0 $ 18,335 Current period costs $ 1,077,725 $ 151,960 $ 387,500 $ 538,265 Total costs $ 1,106,600 $ 162,500 $ 387,500 $ 556,600 Cost per equivalent unit Prior department $ 1.31(1) Materials $ 3.10(2) Labor $ 4.55(3) Manufacturing overhead Table: (2) Compute the total cost of prior department, materials, and manufacturing overhead: Particulars Total Prior department Materials Conversion Costs accounted for: Costs assigned to units transferred out: Costs from beginning WIP inventory $ 28,875 $10,540 0 $18,335 Current costs added to complete beginning WIP inventory $ 85,440 $0 $27,900 (4) $28,665 (5) Current costs of units started and completed $ 949,760 $138,860 (6) $328,600 (7) $482,300 (8) Costs assigned to ending WIP inventory $ 71,400 $ 13,100 (9) $31,000 (10) $27,300 (11) Total costs accounted for $ 1,106,600 $ 162,500 $ 387,500 $ 556,600 Table: (3) Working note 1: Compute the cost per equivalent unit: Cost per equivalent unit = Current period costs Total units accounted for = $ 151 , 960 116 , 000 = $ 1.31 Working note 2: Compute the cost per equivalent unit: Cost per equivalent unit = Current period costs Total units accounted for = $ 387 , 500 125 , 000 = $ 3.10 Working note 3: Compute the cost per equivalent unit: Cost per equivalent unit = Current period costs Total units accounted for = $ 538 , 265 118 , 300 = $ 4

6th Edition

ISBN: 9781307652789

Author: LANEN

Publisher: MCG/CREATE

See similar textbooks

Concept explainers

Process Costing

Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.

Job Costing

Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing …

ABC Costing

Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In compari…

Videos

Question

Chapter 8, Problem 56P

To determine

Prepare a production cost report for June for the Blending Department.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Chapter 8, Problem 55P

Chapter 8, Problem 57P

Students have asked these similar questions

Need assi

Consolidation after Several Years On January 1, 2016, Adams Corporation acquired all of the stock of Baker Company. The fair value of Adams’ shares used in the exchange was $37,500,000. At the time of acquisition, the book value of Baker’s shareholders’ equity was $5,000,000, and the book value of Baker’s building (25-year life) exceeded its fair value by $1,000,000. From the date of acquisition to December 31, 2021, Baker had cumulative net income of $1,300,000. For 2022, Baker reported net income of $300,000. Adams uses the complete equity method to account for its investment in Baker. There is no goodwill impairment loss for the period 2016 through 2021, but there is impairment loss of $100,000 in 2022. Baker declared no dividends during the period 2016–2022. Required Prepare the working paper eliminating entries necessary to consolidate the financial statements of Adams and Baker at December 31, 2022. Enter numerical answers using all zeros (do not abbreviate in thousands or in…

Give me the answer in a clear organized table please. Thank you!

Chapter 8 Solutions

FUNDAMENTALS OF COST ACCOUNTING

Ch. 8 - What are the characteristics of industries most...Ch. 8 - A manufacturing company has records of its...Ch. 8 - If costs increase from one period to another, will...Ch. 8 - What are the five steps to follow when computing...Ch. 8 - What is the distinction between equivalent units...Ch. 8 - Which method, weighted-average or FIFO, better...Ch. 8 - It has been said that a prior departments costs...Ch. 8 - The more important individual unit costs are for...Ch. 8 - Assume that the number of units transferred out of...Ch. 8 - The management of a liquid cleaning product...

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.