A manufacturer uses process costing. It has one direct material cost pool and one conversion cost pool. Information for the month is as follows:

Beginning of Month End of Month

Work in process: 22,000 units 8,000 units

Conversion (% of completion in WIP): 40% 70%

Costs of Materials in WIP: $ 80,000 ?

Costs of Conversion in WIP: $114,000 ?

During the month:

Units started during the month: 70,000 units

Costs incurred for Materials: $300,000

Costs incurred for Conversion: $270,000

Total Spoiled Units detected: 4,400 units

Other Income Statement Information:

Sales: $920,000

Admin expenses $200,000

95% of direct materials is added at the beginning of the process, and the remaining 5% of direct materials (for packaging) is added immediately after inspection.

Inspection occurs when units are 75% converted, and inspection determines if the units are acceptable or spoiled. Normal Spoilage is based on 6% of units started.

There were no finished goods or raw material inventories at any point of the process.

Required:

Part A: Prepare an Income Statement for the month and show the value of ending inventory, assuming that inventory is based on modified FIFO,

Part B: Prepare an Income Statement for the month and show the value of ending inventory, assuming that inventory is based on Weighted Average.