Gunnison Company had the following equivalent units schedule and cost information for its Sewing Department for the month of December:

Required:

1. Calculate the unit cost for December, using the FIFO method.

2. Calculate the cost of goods transferred out, calculate the cost of EWIP, and reconcile the costs assigned with the costs to account for.

3. What if you were asked for the unit cost from the month of November? Calculate November's unit cost and explain why this might be of interest to management.

Direct Materials 40,000 Conversion Costs 40,000 2,500 10,000 Units started and completed Add: Units in beginning work in process X Percentage complete: 5,000 X 0% direct materials 5,000 X 50% conversion costs Add: Units in ending work in process Percentage complete: 10,000 X 100% direct materials 10,000 X 35% conversion costs Equivalent units of output Costs: Work in process, December 1: Direct materials Conversion costs Total work in process Current costs: Direct materials Conversion costs Total current costs 3,500 46,000 50,000 $ 35,000 10,000 $ 45,000 $400,000 184,000 $584,000