Question

SCUIU U U 3 pts 565 (3 comples E17-32 (similar to) Question Help Classic Clothing, Inc., is a manufacturer of winter clothes. It has a knitting department and a finishing department. This exercise focuses on the finishing department Direct materials are added at the end of the process. Conversion costs are added evenly during the process. Suppose that Classic uses the FIFO method. The following information for June 2017 is available m (Click the icon to view the information.) Read the requirements

Answer 1

A)	Statement of equivalent production					Degree of completion
						Transferred In			Direct Materials			Conversion
a)	Particulars	Units	Particulars	Units		%	Units		%	Units		%	Units
	Opening WIP	80	Transfer to next process:
	Transferred In	145	From O/p WIP	80		-	-		100%	80		50%	40
			From Transferred In	80		100%	80		100%	80		100%	80
			Closing WIP	65		100%	65		0%	0		60%	39
		225		225			145			160			159

2)	Total Cost to account for
	Beginning WIP
	Trasferred In	$    57,000.00
	Materials	$                  -
	Conversion	$    40,000.00
		$    97,000.00
	During the period
	Trasferred In	$ 160,000.00
	Materials	$    40,000.00
	Conversion	$    81,600.00
		$ 281,600.00
	Total cost to account for	$ 378,600.00
	Total cost accounted for:
	Cost of units transferred	$ 286,860.77
	Cost of ending WIP	$    91,739.23
	Total cost accounted for	$ 378,600.00

Statement of cost per equivalent production
Element of costs	Units	Costs	Cost/eq. units
Transferred In	145	$      160,000.00	$          1,103.45
Direct Materials	160	$        40,000.00	$             250.00
Conversion	159	$        81,600.00	$             513.21
			$          1,866.66

3)

Cost of Completed Goods
Existing cost =		$       97,000.00	($ 57000 + $ 40000)
Cost of Completing units:
Material Cost =		$       20,000.00	(80 x $ 250)
Conversion cost =		$       20,528.30	(80 x $ 513.21)
Cost of 80 units =		$     149,332.47	(80 x $ 1866.66)
	Total	$     286,860.77
Cost of closing WIP
	Units	Cost/eq. units	Costs
Transferred In	65	$         1,103.45	$    71,724.14
Direct Materials	0	$             250.00	$                  -
Conversion	39	$             513.21	$    20,015.09
		Total	$    91,739.23