FIFO Method, Two-Department Analysis Healthway uses a process-costing system to compute the unit costs of the minerals that it produces. It has three departments: Mixing, Tableting, and Bottling. In Mixing, at the beginning of the process all materials are added and the ingredients for the minerals are measured, sifted, and blended together. The mix is transferred out in gallon containers. The Tableting Department takes the powdered mix and places it in capsules. One gallon of powdered mix converts to 1,600 capsules. After the capsules are filled and polished, they are transferred to Bottling where they are placed in bottles, which are then affixed with a safety seal and a lid and labeled. Each bottle receives 50 capsules. During July, the following results are available for the first two departments (direct materials are added at the beginning in both departments): Mixing Tableting Beginning inventories: Physical units 5 gallons 4,000 capsules Costs: Direct materials $120 $32 Direct labor 128 20 Overhead ? ? Transferred in - 140 Current production: Transferred out 125 gallons 198,000 capsules Ending inventory 6 6000 Costs: Direct materials $3,144 $1,584 Transferred in ? Direct labor 4,096 1,944 Overhead ? ? Percentage of completion: Beginning inventory 40 % 50 % Ending inventory 50 40 Overhead in both departments is applied as a percentage of direct labor costs. In the Mixing Department, overhead is 200 percent of direct labor. In the Tableting Department, the overhead rate is 150 percent of direct labor. Required: 1. Prepare a production report for the Mixing Department using the FIFO method. Follow the five steps outlined in the chapter. If required, round your cost per equivalent unit answers to three decimal places and use them in subsequent computations. Round all other calculations and final answers to the nearest dollar. Healthway Mixing Department Production Report for July 20XX Unit Information Units to account for: Units, beginning work in process Units started Total units to account for Units accounted for: Equivalent Units Physical Flow Direct Materials Conversion Costs Units started and completed Units, beginning work in process Units, ending work in process Total units accounted for Cost Information Costs to account for: Direct Materials Total Conversion Costs Costs in beginning work in process Costs added by department Total costs to account for Cost per equivalent unit Costs accounted for: Ending Transferred Work in Out Process Total Goods started and completed Units, beginning work in process Prior period ll Current period Ending work in process: Direct materials Conversion costs Total costs accounted for 2. Prepare a production report for the Tableting Department using the FIFO method. Follow the five steps outlined in the chapter. If required, round your cost per equivalent unit answers to four decimal places and use them in subsequent computations. Round all other calculations and final answers to the nearest dollar. If an amount is zero, enter "O". Healthway Tableting Department Production Report for July 20xx Unit Information Units to account for: Units, beginning work in process Units started Total units to account for Units accounted for: Equivalent Units Physical Flow Transferred In Direct Materials Conversion Costs Units started and completed Units, beginning work in process Units, ending work in process Total units accounted for Cost Information Costs to account for: Direct Materials Transferred In Total Conversion Costs Costs in beginning work in process Costs added by department Total costs to account for Cost per equivalent unit Costs accounted for: Ending Transferred Work in Out Process Total Goods transferred out Units, beginning work in process: Prior period Current period Ending work in process: Transferred in Direct materials Conversion costs Total costs accounted for
