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ruskin ruskin
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4 years ago
Marvin Ltd. uses an automated process in its manufacturing operations. On November 1, the company had 25,000 units in beginning work in process which were 80% complete with respect to conversion. During the month of November, it started 120,000 into production. On November 30, there were 20,000 units in process, which were 40% complete with respect to conversion. Direct materials are added at the beginning of the process, and no units are spoiled in production.

The beginning inventory had direct materials costs of $105,750 and conversion costs of $45,500. During the month, the company issues $510,000 of direct materials and incurred $203,400 of conversion costs.

Required:
Prepare a production cost worksheet using the FIFO method.
Textbook 

Cost Accounting: A Managerial Emphasis, Canadian Edition


Edition: 7th
Authors:
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btpsandbtpsand
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4 years ago
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PRODUCTION COST WORKSHEET

Flow of production   Physical Units   Direct Materials   Conversion
Work in process, beginning   25,000      
Started during period   120,000      
  To account for   145,000      
         
Units completed         
Work in process, beginning   25,000      5,000
Started and completed   100,000   100,000    100,000
Work in process, ending   20,000   20,000   8,000
   145,000   120,000   113,000

Costs   Totals   Direct Materials   Conversion
Work in process, beginning   $151,250      
Costs added during period   713,400   $510,000   $203,400
Total costs to account for   $864,650   $510,000   $203,400
Divided by equivalent units      120,000   113,000
Equivalent unit costs   $6.05   $4.25   $1.80

      
Assignment of costs      
Work in process, beginning      $151,250
Completion of beginning (5,000 × $1.80)      9,000
Total beginning inventory      160,250
Started and Completed (100,000 × $6.05)      605,000
Total costs transferred out      $765,250
Work in process, ending      
  Direct materials (20,000 × $4.25)   $85,000   
  Conversion (8,000 × $1.80)   14,400   99,400
Costs accounted for      $864,650
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