Question

Yarmouth Company produces a liquid solvent in two departments: Mixing and Finishing. Accounting records at Yarmouth show the following information for Finishing operations for February (no new material is added in the Finishing Department). $ WIP inventory-Pinishing Beginning Inventory (10,800 units, 201 complete with respect to Finishing costs) Transferred-in costs (from Mixing) Finishing conversion costs Current work (99,600 units started) Mixing costs Finishing costs 125,760 5,144 956,160 491. 136 The ending inventory has 14,800 units, which are 60 percent complete with respect to Finishing Department costs and 100 percent complete for Mixing Department costs. Required: a. Complete the production cost report using the FIFO method. (Round "Cost per equivalent unit" to 2 decimal places.) Physical Units Equivalent Units Mixing Finishing Department Department Flow of units Units to be accounted for Beginning WIP inventory Units started this period Total units to account for Units accounted for: Completed and transferred out From beginning WIP Inventory Mixing Finishing < Prey 10 of 15 !!! Next >

Answer 1

Solution:

Yarmouth Company
Finishing Department
Computation of Equivalent unit (FIFO)
Particulars	Physical units	Mixing	Finishing
Units to be accounted for:
Beginning WIP Inventory	10800
Units started this period	99600
Total unit to be accounted for	110400
Units Accounted for:
Units completed and transferred out
From beginning inventory Mixing - 0% Finishing - 80%	10800	0	8640
Started and completed currently	84800	84800	84800
Units in ending WIP Mixing - 100% Finishing - 60%	14800	14800	8880
Total units accounted for	110400	99600	102320

Yarmouth Company
Finishing Department
Computation of Cost per Equivalent unit
Particulars	Total cost	Mixing	Finishing
Current period cost	$1,447,296.00	$956,160.00	$491,136.00
Equivalent units		99600	102320
Cost per equivalent unit		$9.60	$4.80

Yarmouth Company
Finishing Department
Producton cost report - FIFO
Particulars	Total cost	Mixing	Finishing
Cost Accounted for :
Cost assigned to unit transferred out:
Cost from beginning WIP Inventory	$130,904	$125,760	$5,144
Current cost added to complete beginning WIP:
Mixing	$0	$0
Finishing (8640*$4.80)	$41,472		$41,472
Total Cost from beginning inventory	$172,376	$125,760	$46,616
Current cost of unit started and completed:
Mixing (84800*$9.60)	$814,080	$814,080
Finishing (84800*$4.80)	$407,040		$407,040
Total cost of unit started and completed	$1,221,120	$814,080	$407,040
Total cost of unit transferred out	$1,393,496	$939,840	$453,656
Cost assigned to ending WIP:
Mixing (14800*$9.60)	$142,080	$142,080
Finishing (14800*$4.80)	$42,624		$42,624
Total ending WIP inventory	$184,704	$142,080	$42,624
Total cost accounted for	$1,578,200	$1,081,920	$496,280