FIFO Method, Two-Department Analysis Muskoge Company uses a process-costing system. The company manufactures a product that is processed in two departments: Molding and Assembly. In the Molding Department, direct materials are added at the beginning of the process; in the Assembly Department, additional direct materials are added at the end of the process. In both departments, conversion costs are incurred uniformly throughout the process. As work is completed, it is transferred out. The following table summarizes the production activity and costs for February: Molding Assembly Beginning inventories: Physical units 10,000 8,000 Costs: Transferred in $45,300 Direct materials $22,000 Conversion costs $13,800 $16,900 Current production: Units started 25,000 ? 30,000 35,000 Units transferred out Costs: ? Transferred in Direct materials Conversion costs $56,250 $39,550 $103,500 $136,500 Percentage of completion: Beginning inventory 40% 50% Ending inventory 80 50 1. Using the FIFO method, prepare the following for the Molding Department: a. A physical flow schedule Muskoge Company Molding Department Physical Flow Schedule Units to account for: Units, beginning work in process Units started in February (transferred in) 10,000 25,000 35,000 Total units to account for Units accounted for: Units completed and transferred out: Started and completed From beginning work in process 20,000 10,000 Units, ending work in process 5,000 Total units accounted for 35,000 Feedback Check My Work b. An equivalent units calculation Total Equivalent Units Direct Materials 25,000 Conversion Costs 30,000 C. Calculation of unit costs. Round your answer to the nearest cent. 5.7 per unit Cost of ending work in process: $ 25,050 Cost of goods transferred out: $ 134,700 x e. A cost reconciliation. Costs to account for: Beginning work in process Costs incurred 35,000 X Total costs to account for Costs accounted for: Transferred out Ending work in process Total costs accounted for Feedback Check My Work 2. Prepare journal entries that show the flow of manufacturing costs for the Molding Department. (a) Materials are added at the beginning of the process, (b) conversion costs are recorded, and (c) units are transferred to the Assembly Department. (a) (b) (c)