Problem Costing Using the FIFO Method
Riley's Paper Company manufactures computer paper for laser printers. The following information related to production costs incurred in the manufacturing process during the month of March.
Reams of Paper Production Costs
Beginning work in process
(40% complete) 35,000 $89,170
Current-period production 93,000 394,830
Ending work in process
(65% complete) 20,000
The company uses FIFO method of computing equivalent units and assigning product costs. Production costs include both the cost of raw materials and conversion cost that are incurred uniformly in the production process.
A. How many reams of paper were completed in March?
B. Of the reams of paper completed in March, how many were started and completed during the month?
C. How many equivalent finished units did the company complete in March?
D. What is the cost per equivalent unit?
E. Calculate the cost of ending work in process inventory and the cost of goods manufactured in March?