Poole, Inc., produces a chemical compound by a unique chemical process which Poole has divided into two departments, A and B, for accounting purposes. The process functions are as follows:

The formula for the chemical compound requires | pound of chemical X and | pound of chemical Y. In the simplest sense, | pound of chemical X is processed in Department A and transferred for further processing to Department B, where | pound of chemical Y is added when the process is complete. When the processing is complete in Department B, the finished chemical compound is transferred to finished goods inventory. The process is continuous, operating 24 hours a day.

Normal spoilage occurs in Department A. Five percent of chemical X is spoiled in the first few seconds of processing.

The company’s policy is to treat the cost of spoiled units in production as a separate element of cost in the department in which the spoilage occurs.

No spoilage occurs in Department B.

In Department A, conversion costs are incurred uniformly throughout the process.

In Department B, conversion costs are allocated equally to each equivalent pound of output.

Poole’s unit of measure for work-in-process and finished goods inventories is pounds. The following data are available for the month of October: mk4

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Work-in-process inventory, October 1 Stage of completion of beginning inventory (one batch per department) Started or transferred in Transferred out Work-in-process inventory, October 31 Stage of completion of ending inventory Total equivalent pounds of direct material added in Department B Required: a Complete the above schedule. Department A 8,000 lb Department B 10,000 lb % 0 50,000 lb ? 46,500 lb ? ? ? % 16 44,500 lb b Prepare equivalent production schedules for Department A and Department B for October under fifo. (AICPA Adapted.)