Annin Laboratories uses the FIFO method to account for its work-in-process inventories. The accounting records show the following information for February:Beginning WIP inventory Direct materials$ 24,553Conversion costs8,005Current period costs Direct materials145,832Conversion costs72,740Quantity information is obtained from the manufacturing records and includes the following:Beginning inventory6,000units(40% complete as to materials, 15% complete as to conversion)Current period units started44,800units Ending inventory19,000units(75% complete as to materials, 35% complete as to conversion) Required:Compute the equivalent units for the materials and conversion cost calculations.Compute the cost per equivalent unit for direct materials and for conversion costs for February using the FIFO method.

FIFO METHOD :— Under this method, equivalent units are calculated by adding equivalent units in…

Answered: Annin Laboratories uses the FIFO method…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter2: Basic Cost Management Concepts

Section: Chapter Questions

Problem 13E: Wyandotte Company provided the following information for the last calendar year: During the year,...

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Beginning WIP inventory
Direct materials	$ 24,553
Conversion costs	8,005
Current period costs
Direct materials	145,832
Conversion costs	72,740

Beginning inventory	6,000	units	(40% complete as to materials, 15% complete as to conversion)
Current period units started	44,800	units
Ending inventory	19,000	units	(75% complete as to materials, 35% complete as to conversion)

Required:

Compute the equivalent units for the materials and conversion cost calculations.
Compute the cost per equivalent unit for direct materials and for conversion costs for February using the FIFO method.

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