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Solutions Manual, Appendix 4A 41
Appendix 4A
FIFO Method
Exercise 4A-1 (10 minutes)
FIFO Method
Materials Conversion
Equivalent units to complete be
g
innin
g
work in
process inventory:
Materials: 30,000 units × (100% − 65%) …….. 10,500
inventory:
Materials: 15,000 units × 80% complete ……… 12,000
Conversion: 15,000 units × 40% complete …… 6,000
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42 Managerial Accounting, 16th Edition
Exercise 4A-2 (10 minutes)
FIFO method
Materials Labor Overhead
Cost added durin
g
May (a) …………… $193,320 $62,000 $310,000
T
ota
l
Materials ……………………………………………. $7.16
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Solutions Manual, Appendix 4A 43
Exercise 4A-3 (15 minutes)
1. and 2.
Material
s
Conversio
n
T
ota
l
Endin
g
work in process inventory
:
Equivalent units …………………………….. 400 200
Units transferred out
:
Cost in be
g
innin
g
inventory………………. $3,200 $650 $3,850
Cost to complete the units in be
g
innin
g
inventory
:
Equivalent units needed to complete
Cost of units started and completed this period
:
Units started and completed this period
(26,000 units completed and
transferred to the next department
– 2,000 units in beginning work in
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44 Managerial Accounting, 16th Edition
Exercise 4A-4 (10 minutes)
Mixin
g
Department
Cost Reconciliation
Costs to be accounted for:
Cost of be
g
innin
g
work in process inventory . $ 1,460
*The cost of units completed and transferred out can be deduced as
follows:
Cost of beginning Costs added Cost of ending Cost of units
Cost of
$1,460 + $36,540 = $3,120 +
units
completed and
transferred out
Cost of units
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Solutions Manual, Appendix 4A 45
Exercise 4A-5 (10 minutes)
Materials Conversion
Equivalent units needed to complete beginning
work in process inventory:
Materials: 500 units x (100% – 80%) ………….. 100
Equivalent units in ending work in process
inventory:
Materials: 400 units x 75% complete …………… 300
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46 Managerial Accounting, 16th Edition
Exercise 4A-6 (15 minutes)
FIFO Method
Materials
Labor &
Overhead
Equivalent units needed to complete the be
g
innin
g
work in process inventory:
Materials: 20,000 pounds × (100% − 100%)…… 0
Labor and overhead:
* 380,000 pounds started
–
25,000 pounds in endin
g
work in process
© The McGraw-Hill Companies, Inc., 2018. All rights reserved.
Solutions Manual, Appendix 4A 47
Exercise 4A-7 (20 minutes)
FIFO Method
1.
Materials Labor Overhead
Equivalent units needed to complete
beginning work in process inventory:
Materials: 5,000 units ×
(100% − 80%) ………………………… 1,000
Units started and completed durin
g
the
period* …………………………………….. 37,000 37,000 37,000
Equivalent units in endin
g
work in
process inventory:
2.
Materials Labor Overhead
Cost added durin
g
the period (a)………. $52,800 $21,500 $32,250
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48 Managerial Accounting, 16th Edition
Exercise 4A-8 (15 minutes)
FIFO Method
1.
Tons of Pulp
Work in process, June 1…………………………………… 20,000
Started into production durin
g
the month …………….. 190,000
2.
Equivalent Units
Materials
Labor and
Overhead
Equivalent units needed to complete
beginning work in process inventory:
inventory:
Materials: 30,000 tons × 60% complete . 18,000
Labor and overhead:
30,000 tons × 40% complete ……..…… 12,000
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Solutions Manual, Appendix 4A 49
Exercise 4A-9 (45 minutes)
FIFO Method
1. Computation of the total cost per equivalent unit:
2. Computation of equivalent units in ending inventory:
Materials Conversion
3. Computation of equivalent units required to complete the beginning
inventory:
Materials Conversion
Units in be
g
innin
g
inventory (a) ………… 400 400
4. Units transferred to the next department………… 3,100
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50 Managerial Accounting, 16th Edition
Exercise 4A-9 (continued)
5. and 6.
Material
s
Conversio
n
T
ota
l
Endin
g
work in process inventory:
Equivalent units …………………………… 210 180
Units transferred out:
Cost from the be
g
innin
g
work in
Cost to complete the units in be
g
innin
g
work in process inventory:
Equivalent units needed to complete
Cost of units started and completed
this period:
Units started and completed this
period ………………………………… 2,700 2,700