1. FreshStream Water, a bottled water producer, operates a Blending Department where materials are added at the beginning of the process, and conversion costs are added evenly throughout. In January, the department began 360,000 units, completed and transferred 330,000 units to Packaging, and had an ending work in process inventory of 30,000 units, 65% completed. The costs for January include direct materials of $180,000 and conversion costs of $108,000, with no beginning work in process. Calculate the cost of the units completed and transferred out to the Packaging Department and the total cost of the units in the Blending Department's ending work in process inventory using the five-step process. Additionally, prepare a statement of retained earnings reflecting the impact of the Blending Department's activities on the company's overall equity for January.