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ID: 2538862 • Letter: T

Question

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Required information Problem 16-7AA FIFO: Process cost summary, equivalent units, cost estimates LO C2, C3, C4, P4 [The following information applies to the questions displayed below Dengo Co. makes a trail mix in two departments: roasting and blending. Direct materials are added at the beginning of each process, and conversion costs are added evenly throughout each process. The company uses the FIFO method of process costing. During October, the roasting department completed and transferred 23,000 units to the blending department. Of the units completed, 3,400 were from beginning inventory and the remaining 19,600 were started and completed during the month. Beginning work in process was 100% complete with respect to direct materials and 40% complete with respect to conversion. The company has 2,800 units (100% complete with respect to direct materials and 80% complete with respect to conversion) in process at month-end. Information on the roasting department's costs of beginning work in process inventory and costs added during the month follows Direct cost of beginning work in process inventory Added during the month terials Conversi Ma on 5 10,300 S 111,690 266,5601,117,534 Problem 16-7A Part 1 Required 1. Prepare the roasting department's process cost summary for October using the FIFO method (Round Cost per EUP" to 2 decimaf places.) Total costs to account for:

Explanation / Answer

UNITS TO ACCOUNT FOR: Beginning Work in Process units 3,400 Add: Units Started in Process 22,400 Total Units to account for: 25,800 UNITS TO BE ACCOUNTED FOR: Units completed from Beginning WIP 3400 Units started and completed 19,600 Ending Work in Process 2,800 Total Units to be accounted for: 25,800 Equivalent Units: UNITS Material Cost Conversion % Completion Units % Completion Units Units completed from Beg. WIP 3400 0% 0 60% 2,040 Units started and completed 19600 100% 19,600 100% 19,600 Ending Work in Process 2800 100% 2,800 80% 2,240 Total Equivalent units 25800 162,000 166,620 COST PER EQUIVALENT UNIT: Material Conversion Total cost added during the year 266,500 1,117,584 Equivalent Units 162,000 166,620 Cost per Equivalent unit 1.64 6.71 TOTAL COST ACCOUNTED FOR: Units Completed from Beginning WIP (3400 units) Equivalent unit Cost per EU Total Cost Beginning Cost 121990 Material 0 1.64 0 Conversion Cost 2,040 6.71 13688 Cost of units completed from Beg WIP 135678 Units started and Transferred out (19600 units) Equivalent unit Cost per EU Total Cost Material 19,600 1.64 32144 Conversion Cost 19,600 6.71 131516 Total Cost of Units completed and transferred out: 163660 Ending Work in process (2800 units) Equivalent unit Cost per EU Total Cost Material 2,800 1.64 4592 Conversison Cost 2,240 6.71 15030 Total cost of Ending Work in process: 19,622

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