$2.$ XOUT Inc.manufactures stone counter top cleaner in a continuous process and uses a process cost system.$$ During the month the company started $500,000$ gallons of raw material into process at a cost of $$450,000.$ It takes $1\mathrm{.}25$ gallons of raw material to produce $1$ gallon of cleaner.$$ In addition the company spent $$1,200,000$ in direct labor cost and $$2,000,000$ in manufacturing OH$.$ During the month $350,000$ gallons of cleaner were complete and transferred to finished goods.$300,000$ gallons of cleaner were sold for a total price of $$3,100,000.$ At the end of the month the stone cleaner still in WIP inventory was $100\%$ complete as to raw matl. and $35\%$ complete as to direct labor and factory OH$.$

Required: $30$ pts$.$

a$.$ Assume there are no beginning inventories in work in process and finished goods. Use the following form to determine the cost per equivalent unit of production. the ending inventory value of WIP and F$.$G$.$ inventory, the Cost of Goods Sold and the Gross Profit for the month.

$$

$$

$$

$$

$$

$$

UNITS

COMP $\%$

EQUIVALENT

UTS COMPLETE

UTS TRANS

TOTAL EQ$.$ UTS

COST PER EQUV UNTS

MATL

$$

$$

$$

$$

$$

LABOR

$$

$$

$$

$$

$$

O$.$H$.$

$$

$$

$$

$$

$$

TOTAL COST$/$ EQ$.$ UNIT$=$

b$.$ Use the $$T$$ accounts below to determine the ending inventory value of WIP, F$.$G$.$ inventory,$$ and the Cost of Goods Sold.

WORK IN PROCESS

FINISHED GOODS

COST OF GOODS

INVENTORY

INVENTORY

SOLD

$$

$$

$$

$$

$$

$$

$$

$$

$$

$$

$$

$$

c$.$ What is the gross profit for the month?