Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Facemasks Ltd. uses the First-In, First-Out (FIFO) costing method to account for the production of reusable facemasks which passes through the cutting and stitching departments.

image text in transcribed

Facemasks Ltd. uses the First-In, First-Out (FIFO) costing method to account for the production of reusable facemasks which passes through the cutting and stitching departments. In the stitching department, all materials are added at the beginning of the process and all other manufacturing inputs are added uniformly. Beginning work-in-process on 1st December had 2.000.000 units which were 50% complete with respect to conversion costs and the associated costs were $1,800,000 for direct materials and $4,200,000 for conversion costs. On 31st December, ending work-in-process had 1,000,000 units that were 40% complete with respect to conversion costs. During December 4,000,000 units were completed and transferred out and the direct materials cost of $4,500,000 and conversion cost of $8,000,000 were incurred during December. Required: 1. Prepare a physical flow schedule. 2. Prepare a schedule of equivalent units. 3. Calculate the cost per equivalent unit (round amounts to two decimal places). 4. Calculate the cost of goods completed and transferred out and the cost of ending work-in- process, and total costs accounted for during December. 5. Facemasks Ltd. is considering adopting the weighted average process costing method instead of the FIFO method. Should Facemasks Ltd. go ahead with this new adoption, or should it continue using its existing FIFO process costing approach? Explain and justify your recommendation 2 monro

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting

Authors: Walter B. Meigs, A. N. Mosich, Robert F. Meigs

2nd Edition

0070412901, 978-0070412903

More Books

Students also viewed these Accounting questions