Process Costing
Pantanal, Inc., manufactures car seats in a local factory. For costing purposes, it uses a first in, first out (FIFO) process costing system. The factory has three departments: Molding, Assembling, and Finishing. Following is information on the beginning work in process inventory in the Assembling Department on August 1:
|
Costs
|
Degree of Completion |
Work in process beginning inventory (10,000 units) |
|
|
Transferred in from Molding |
$ 98,000 |
100% |
Direct materials costs |
164,400 |
60 |
Conversion costs |
61,000 |
40 |
Work in process balance (August 1) |
$323,400 |
100% |
During August, 102,000 units were transferred in from the Molding Department at a cost of $2,142,000 and started in Assembling. The Assembling Department incurred other costs of $1,164,600 in August as follows:
|
August Costs |
Direct materials costs |
$ 939,600 |
Conversion costs |
225,000 |
Total August costs |
$1,164,600 |
At the end of August, 16,000 units remained in inventory that were 90 percent complete with respect to direct materials and 50 percent complete with respect to conversion.
Required
Compute the cost of goods transferred out in August and the cost of work in process ending inventory.