FIFO Method, Physical Flow, Equivalent Units, Unit Costs, Cost Assignment

Swasey Fabrication, Inc., manufactures frames for bicycles. Each frame passes through three processes: Cutting, Welding, and Painting. In September, the Cutting

Department of the Tulsa, Oklahoma, plant reported the following data:

a$.$ In Cutting, all direct materials are added at the beginning of the process.

b$.$ Beginning work in process consisted of $40,000$ units, $20$ percent complete with respect to direct labor and overhead. Costs in beginning inventory included direct

materials, $$1,215,000$; direct labor, $$223,000$; and applied overhead, $$150,000.$

c$.$ Costs added to production during the month were direct materials, $$2,575,000$; direct labor, $$3,471,050.$ Overhead was assigned using the following

information:

d$.$ At the end of the month, $122,000$ units were transferred out to Welding, leaving $14,000$ units in ending work in process, or $25$ percent complete.

Assume that the FIFO method is used.

Required:

Prepare a physical flow schedule.

Swasey Fabrication, Inc.

Physical Flow Schedule

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A physical flow schedule shows the units to account for and what happened to them.

Calculate equivalent units of production for direct materials and conversion costs.

Equivalent Units

Compute unit cost. Round unit costs & final answer to three decimal places.

$

$$ per unit

Calculate the cost of goods transferred to Welding at the end of the month. In your calculations, round unit costs to three decimal places. Round your

final answer to the nearest dollar.

$

$x$

Calculate the cost of ending inventory. In your calculations, round unit costs to three decimal places. Round your final answer to the nearest dollar.

$