Inventories are costed by the first-in first-out method


Question - The inventory at May 1 and the costs charged to work in process-department B during May for Stella Company are as follows.

Beginning WIP, 12,000 UNITS, 60% completed - 62,400

From Department A, 55,000 units started this period:

Direct materials added - 115,500

Direct Labor incurred - 384,915

Factory overhead incurred - 138,000

During May all direct materials are transferred from Department A, the units in process at May 1 were completed and of the 55,000 units entering the department, all were completed except 6,000 units which were 70% completed. Inventories are costed by the first-in, first-out method.

Prepare a cost of production report for May.

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Accounting Basics: Inventories are costed by the first-in first-out method
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