FIFO Process Costing, Overhead Allocation: Zeus Company has two production departments (fabricating and finishing). In the fabricating department, polyplast is prepared from miracle mix and bypro. In the finishing department, each unit of polyplast is converted into six tetraplexes and three uniplexes.

Both production departments use process costing systems. All inventories are costed on a FIFO basis. The following data were taken from the fabricating department's records for the current month:

Spoiled units are discovered at the end of the process. The direct production overhead above does not include any allocation of the following overhead costs:

These costs are allocated to production departments using the following bases:

Additional inventory data for the fabricating department are:

Materials inventory:

Required:

a. Prepare a production cost report for the fabricating department for the month. Include the supporting schedules necessary to explain your computations.

b. Show the flow of costs through T-accounts.

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Quantities of polyplast: On hand at start of month Started during the month Transferred to finishing Spoiled units (normal) 3,000 25,000 19,000 3,000 Costs of work in process: Beginning inventory: Direct materials $13,000 Conversion costs 39,000 Current period costs: Direct labor 154,000 Direct production overhead 132,000