The assembly division of Canterbury WatchesCanterbury Watches, Inc. uses the FIFO method of process costing. Consider the following data for the month of May 2017:

Physical Units	Direct	Conversion
	(Watches)	Materials	Costs

Beginning work in process left parenthesis May 1 right parenthesis Superscript a(May 1)a	60	$249,750	$96,800
Started in May 2017	478
Completed during May 2017	443
Ending work in process left parenthesis May 31 right parenthesis Superscript b(May 31)b	95
Total costs added during May 2017		$2,598,000	$1,251,600

Superscript aaDegree of completion: direct materials, 80%; conversion costs, 25%.

Superscript bbDegree of completion: direct materials 40%; conversion costs,costs, 20%

Equivalent Units

Direct Materials Conversion Costs

Flow of Production

Completed and transferred out during current period:

From beginning work in process 12 45

Started and completed 383 383

Work in process, ending 38 19

Equivalent units of work done in current period 433 447

Requirement

Summarize the total costs to account for, calculate the cost per equivalent unit for direct materials and conversion costs, and assign costs to units completed (and transferred out) and to units in ending work in process.

Begin by summarizing the total costs to account for.

		Total	Direct	Conversion
		Production Costs	Materials	Costs
Total costs to account for

Next, calculate cost per equivalent unit for direct materials and conversion costs.

		Direct	Conversion
		Materials	Costs
Divide by
Cost per equivalent unit

Finally, assign total costs to units completed (and transferred out) and to units in ending work in process (WIP). Begin by calculating the total from beginning inventory, then calculate the total costs accounted for.

		Total	Direct	Conversion
		Production Costs	Materials	Costs
Completed and transferred out:
Total from beginning inventory

Total costs of units completed and transferred out
Total costs accounted for