Use the following information to answer questions 2 and 3: Epsilon Co. manufactures a product that is processed through two departments. The following information was obtained for the rst department in January: . All direct materials are added at the beginning of the process, while conversion costs are added evenly throughout the process. 0 Inspection takes place when the units are 40% complete. Normal spoilage is considered to be 2% of good units passing inspection in the period. All spoiled units are discarded. . Beginning work-in-process (WIP) consisted of 100,000 units, 45% complete with respect to conversion costs. . Costs in beginning inventory included direct materials of $122,750 and conversion costs of $200,920. 0 There were 247,500 units started during the month, and costs added to production during the month totalled $303,800 for direct materials and $497,200 in conversion costs. . Atotal of 250,000 units were transferred to the second department, and 93,900 units remained in ending WIP, 20% complete