E 10. Toy Country Corporation produces children’s toys using a liquid plastic formula and a continuous production process. In the company’s toy truck work cell, the plastic is heated and fed into a molding machine. The molded toys are then cooled and trimmed and sent to the packaging work cell. All direct materials are added at the beginning of the process. In November, the beginning work in process inventory was 420 units, which were 40 percent complete; the ending balance was 400 units, which were 70 percent complete.

During November, 15,000 units were started into production. The Work in Process Inventory account had a beginning balance of $937 for direct materials costs and $370 for conversion costs. In the course of the month, $35,300 of direct materials were added to the process, and $31,760 of conversion costs were assigned to the work cell. Using the FIFO costing method, prepare a process cost report that computes the equivalent units for November, the product unit cost for the toys, and the ending balance in the Work in Process Inventory account.

Equivalent Production: Average Costing Method