TAO CORPORATION

The TAO CORPORATION manufactures chairs that must go through one department.

Direct materials are added at the beginning of the process. Conversion costs are added evenly during the process. The accounting records for February provide the following information:

Conversion

Physical Units Materials Costs

Beginning inventory

Work in Process 20 $460,000 $120,000

Started during February 80

Completed in February 90

Ending inventory

Work in Process ?

February costs $2,000,000 $927,600

Note: The beginning inventory is 60% complete as to conversion costs, and the ending inventory is 70% complete as to conversion costs. TAO uses the weighted average method.

REQUIRED:

Determine the equivalent units for February.

Compute the costs per equivalent unit for February.

Determine the total cost of the units transferred out and the ending work in process inventory.

Prepare all regular journal entries for February.