Calculate Equivalent Units, Unit Costs, and Transferred CostsFIFO Method

Godfrey Manufacturing, Inc., operates a plant that produces its own regionally marketed Spicy Steak Sauce. The sauce is produced in two processes, blending and bottling. In the Blending Department, all materials are added at the start of the process, and labor and overhead are incurred evenly throughout the process. Godfrey uses the FIFO method. The following data from the Work in ProcessBlending Department account for January 2016 is missing a few items:

Work in Process - Blending Department

January 1 inventory (5,000 gallons, 60% processed) $68,020

Transferred to Bottling Department (60,000 gallons)

January charges:

Direct material (61,000 gallons) 579,500

Direct labor 471,300

Manufacturing overhead 201,900

January 31 inventory ( _______ gallons, 70% processed)

Assuming Godfrey uses the FIFO method in process costing, calculate the following amounts for the Blending Department:

a. Number of units in the January 31 inventory.

b. Equivalent units for materials and conversion costs.

c. January cost per equivalent unit for materials and conversion costs.

d. Cost of the units transferred to the Bottling Department.

e. Cost of the incomplete units in the January 31 inventory

Round average cost per equivalent unit to two decimal places, if applicable. Round other answers to the nearest whole number, when appropriate.

Godfrey Manufacturing, Inc. Blending Department

Flow of Units and Equivalent Units Calculation, January 2016

Equivalent Units

% in Direct % in Conversion

January Materials January Costs

Complete/Transferred

Beginning Inventory

Started and completed

Ending inventory

Total b. b.

Product Cost Report

Direct Conversion

Materials Costs

Beginning Inventory

Current

Total Costs to Account For

Total Equivalent Units c. c.

Average cost / Equivalent unit (round two two decimal places)

Beginning inventory

Costs incurred in Dec.

Costs incurred in Jan.

Started and finished

Cost of goods manufactured d.

Ending inventory:

Direct Materials

Conversion costs

Cost of Ending Inventory e.

Total Costs Allocated