Liquid Extracts Company produces a line of fruit extracts for home use in making wine, jams and jellies, pies, and meat sauces. Fruits enter the production process in pounds; the product emerges in quarts (1 pound of input equals 1 quart of output). On May 31, 4,250 units were in process. All direct materials had been added, and the units were 70 percent complete for conversion costs. Direct materials costs of $4,607 and conversion costs of $3,535 were attatched to the units in beginning work in process inventory. During June, 61,300 pounds of fruit were added at a cost of $71,108. Direct labor for the month totaled $19,760, and overhead costs applied were $31,375. On June 30, 3,400 units remained in process. All direct materials for these units had been added, and 50 percent of conversion costs had been incurred. Required 1. Using the FIFO costing method, prepare a process cost report for June. 2. From the information in the process cost report, identify the amount that should be transferred out of the Work in Process Inventory account, and state where those dollars should be transferred.

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Physical

Units

Beginning inventory

Equivalent Units

Units started this period

Direct

Conversion

Units to be accounted for

Materials

Costs

Beginning inventory

0%

0%

Units started and completed

0%

0%

Ending inventory

0%

0%

Units accounted for

Total

Direct

Conversion

Costs

Materials

Costs

Beginning inventory

$

=

$

+

$

Current costs

=

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Total costs $ Current Costs $ $ Equivalent Units Cost per equivalent unit #DIV/0! = #DIV/0! + #DIV/0! Cost of goods manufactured and transferred out: From beginning inventory $ Current costs to complete #DIV/0! = ( x #DIV/0! ) Units started and completed this period #DIV/0! = ( x #DIV/0! ) + ( x #DIV/0! ) Cost of goods manufactured #DIV/0! Ending inventory #DIV/0! = ( x #DIV/0! ) + ( x #DIV/0! ) Total costs #DIV/0! *( $ + $ ) 2. Amount to be transferred identified The amount of #DIV/0! should be transferred to the Finished Goods Inventory account.