(Appendix 4A)Tarten Company uses the FIFO method in its process costing system.Operating data for the Curing Department for the month of March appear below:

According to the company's records,the conversion cost in beginning work-in-process inventory was $7,470 at the beginning of March.The cost per equivalent unit for conversion costs for March was $8.20.
How much conversion cost would be assigned to the units completed and transferred out of the department during March?
A) $525,530.
B) $592,040.
C) $533,090.
D) $533,000.

Question

(Appendix 4A)Tarten Company uses the FIFO method in its process costing system.Operating data for the Curing Department for the month of March appear below:

According to the company's records,the conversion cost in beginning work-in-process inventory was $7,470 at the beginning of March.The cost per equivalent unit for conversion costs for March was $8.20.
How much conversion cost would be assigned to the units completed and transferred out of the department during March?
A) $525,530. 
B) $592,040. 
C) $533,090. 
D) $533,000.

Quizplus · Accepted Answer

To determine the conversion cost assigned to the units completed and transferred out of the department during March, we need to calculate the equivalent units of production for conversion costs:

Equivalent units of production for March = Units completed and transferred out + Ending work-in-process inventory
Equivalent units of production for March = 70,000 + 20,000
Equivalent units of production for March = 90,000

Conversion cost assigned to units completed and transferred out = Equivalent units of production for March × Cost per equivalent unit for conversion costs
Conversion cost assigned to units completed and transferred out = 90,000 × $8.20
Conversion cost assigned to units completed and transferred out = $533,090

Therefore, the best choice is C, which is $533,090.

(Appendix 4A)Tarten Company Uses the FIFO Method in Its Process