Process K-Briggs Company uses the FIFO method to account for the costs of production. For Crushing, the first processing department, the following equivalent units schedule has been prepared:

The cost per equivalent unit for the period was as follows:
Direct materials ........ $2.00
Conversion costs ........ 6.00
Total .............. $8.00
The cost of beginning work in process was direct materials, $40,000; conversion costs, $30,000.
Required:
1. Determine the cost of ending work in process and the cost of goods transferred out.
2. Prepare a physical flow schedule.

Direct Materials Conversion Costs Units started and completed Units, beginning work in process: 28,000 28,000 10,000 0% 10,000 40% 4.000 Units, ending work in process 6,000> < 100% 6,000 75% 6,000 4,500 38,500 Equivalent units of output 34,000