(Appendix 6A) First-In, First-Out Method
Refer to Problem 6-67.
Required:
Prepare a production report for the mixing and encapsulating departments using the FIFO method. (Note: Round the unit cost to four decimal places.) (Hint: For the second department, you must convert gallons to capsules.)
Make production report of Company BP by applying FIFO method.
Production Report:
The document comprises all the activities of process department related to manufacturing which occurs; in a particular period of time is called production report. It helps to identify the efficiency of process department.
Prepare production report of company M as shown below:
Company BP | |||||
Mixing Department | |||||
Production Report for March Month | |||||
FIFO Method | |||||
Unit Information | |||||
Physical Flow: | |||||
Units to accounts for: | Units | Units to accounted for: | Units | ||
Units in BWIP | 10 | Unit started and completed | 130 | ||
Units started | 150 | From BWIP | 10 | ||
 |  | Units in EWIP | 20 | ||
Total units to account for | 160 | Total units accounted for | 160 | ||
 |  | ||||
Equivalent Units | Â | ||||
Started and completed | 130 | ||||
To complete BWIP | 6 | ||||
Units in EWIP | 10 | ||||
Total equivalent units | 146 | ||||
Cost Information | |||||
Cost to account for: |
Material (In$) |
Conversion (In$) |
Total (In$) | ||
Cost in BWIP | 252 | 846 | 1,098 | ||
Cost added by department | 3,636 | 13,854 | 17,490 | ||
Total cost to account for: | 3,888 | 14,700 | 18,588 | ||
Cost per equivalent unit | Â | Â | $119.7945 | ||
 |  | ||||
Costs to account for: | Transferred out (In $) |
EWIP (In $) |
Total (In $) | ||
Transferred out: | Â | ||||
Units started and completed | 15,573 | Â | 15573 | ||
Units in BWIP: | Â | Â | Â | ||
From prior period | 1,098 | Â | 1,098 | ||
From current period | 719 | Â | 719 | ||
Goods in EWIP | Â | 1198 | 1198 | ||
Total cost accounted for: | 17,390 | 1,198 | 18,588 |
Table (1)
Therefore, cost per equivalent unit, equivalent units and total cost are $119.7495, 146 gallons and $18,588 respectively
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