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:

Units, ending work in process:

Costs in beginning work in process were direct materials, $$20,000$; conversion costs, $$80,000.$ Manufacturing costs incurred during Apri

were direct materials, $$180,000$; conversion costs, $$352,000.$

Required:

Prepare a physical flow schedule for April.

Dama Company

Physical Flow Schedule

Units to account for:

Units accounted for:

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A physical flow schedule shows the units to account for and what happened to them.

Compute the cost per equivalent unit for April. If required, round your answer to the nearest cent.

$$,$ per equivalent unit

Determine the cost of ending work in process and the cost of goods transferred out.

Cost of ending work in process &

Cost of goods transferred out &

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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.

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.

Prepare the journal entry that transfers the costs from Cutting to Sewing.

Work in Process$-$Cutting $-x$

Work in Process$-$Sewing $**x$