Question - First-In, First-Out Method; Equivalent Units
Inca Inc. produces soft drinks. Mixing is the first department and its output is measured in gallons. Inca uses the FIFO method. All manufacturing costs are added uniformly. For July, the mixing department provided the following information:
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Production:
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Units in process, July 1, 80% complete
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24,500 gallons
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Units completed and transferred out
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138,000 gallons
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Units in process, July 31, 75% complete
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16,500 gallons
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Costs:
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Work in process, July 1
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$24,500
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Costs added during July
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301,000
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Required:
1. Calculate the equivalent units for July.
2. Calculate the unit cost. Round your answer to the nearest cent.
3. Assign costs to units transferred out and EWIP using the FIFO method. If required, round your final answers to the nearest cent.