FIFO Method, Unit Cost, Valuation of Goods Transferred Out and Ending Work in Process Dama Company produces women's blouses and uses the FIFO method to account for its manufacturing costs. The product Dama makes passes through two processes: Cutting and Sewing. During April, Dama's controller prepared the following equivalent units schedule for the Cutting Department: Conversion Costs Direct Materials Units started and completed 40,000 40,000 Units, beginning work in process: 14,000 x 0% 14,000 x 50% 7,000 Units, ending work in process: 20,000 x 100% 20,000 - 5,000 20,000 x 25% Equivalent units of output 60,000 52,000 Costs in beginning work in process were direct materials, $25,000; conversion costs, $80,000. Manufacturing costs incurred during April were direct materials, $180,000; conversion costs, $332,800. Required: 1. Prepare a physical flow schedule for April. Dama Company Physical Flow Schedule Units to account for: Units, beginning work in process 14,000 2. Compute the cost per equivalent unit for April. If required, round your answer to the nearest cent. $ 9.4 per equivalent unit 3. Determine the cost of ending work in process and the cost of goods transferred out. Cost of ending work in process 92,000 Cost of goods transferred out $ Feedback Check My Work 2. The equivalent units schedule measures the output of the period. A fully completed unit is counted as a unit of output. Output for a unit in ending work in process is counted by its degree of completion. 3. Unit cost = Costs of the period - Output of the period. The cost of goods (services) transferred out is the unit cost multiplied by the units completed. The cost of EWIP is the unit cost multiplied by the equivalent units found in EWIP. 4. Prepare the journal entry that transfers the costs from Cutting to Sewing. Work in Process-Sewing Work in Process-Cutting Feedback Check My Work 4. The partially comnleted units and all their associated costs are transferred to the next process bv debiting the WIP account of the process receiving the unit and 2UUUUWWIU Equivalent units of output 60,000 52,000 $2,000 Costs in beginning work in process were direct materials, $25,000; conversion costs, $80,000. Manufacturing costs incurred during April were direct materials, $180,000; conversion costs, $332,800. Required: 1. Prepare a physical flow schedule for April. Dama Company Physical Flow Schedule Units to account for: Units, beginning work in process 14,000 Units started 60,000 Total units to account for 74,000 Units accounted for: Started and completed 40,000 Units, beginning work in process 14,000 Units, ending work in process 20,000 Total units accounted for 74,000 Feedback Check My Work