Question: Transferred-in costs, FIFO method. Refer to the information in Exercise. Suppose that Trendy uses the FIFO method instead of the weighted-average method in all of its departments. The only changes to Exercise 17-31 under the FIFO method are that total transferred-in costs of beginning work in process on June 1 are $45,000 (instead of $60,000) and total transferred-in costs added during June are $114,000 (instead of $117,000). Do Exercise 17-31 using the FIFO method. Note that you first need to calculate equivalent units of work done in the current period (for transferred-in costs, direct materials, and conversion costs) to complete beginning work in process, to start and complete new units, and to produce ending work in process.
Exercise: Transferred-in costs, weighted-average method. Trendy Clothing, Inc. is a manufacturer of winter clothes. It has a knitting department and a finishing department. This exercise focuses on the finishing department. Direct materials are added at the end of the process. Conversion costs are added evenly during the process. Trendy uses the weighted-average method of process costing. The following information for June 2017 is available.
1. Calculate equivalent units of transferred-in costs, direct materials, and conversion costs.
2. Summarize the total costs to account for, and calculate the cost per equivalent unit for transferred-in costs, direct materials, and conversion costs.
3. Assign costs to units completed (and transferred out) and to units in ending work in process.