Could somebody please review my calculations and fix where I made a mistake ?
Please see atached problem and attached calculations
The Sellalot Corporation makes specialty prepared soups for the wholesale restaurant industry in a one department operation. The soup ingredients materials are all added at the start of the process. Conversion costs are added evenly during the production process. At the end of the cooking process the soup in packaged in one gallon stainless steel containers.
Gallons in process, July 1 (soup ingredient materials, 100% complete; conversion costs, 75% complete; stainless steel container materials, 0% complete) 40,000 gallons
Gallons started into production 100,000 gallons
Units Completed and Packed in Containers
Units in process, July 31 (soup ingredient materials, 100% complete; conversion costs, 50% complete; stainless steel container materials, 0% complete) 20,000 gallons
Work in process inventory, July 1:
Soup ingredient materials cost $52,000
Conversion cost $40,000
Stainless steel container materials cost $ 0
Total cost of WIP, July 1 = $92,000
Costs added during the month of July:
Soup ingredient materials cost $200,000
Conversion cost $155,000
Stainless steel container materials cost $240,000
Total cost added during July = $595,000
Total Cost to Account For: $687,000
The company uses the First-in, First-Out (FIFO) method to calculate costs.
a) Prepare a quantity schedule and compute the equivalent units.
b) Compute the costs per equivalent units.
c) Using the data for (a) and (b) above, prepare a cost reconciliation.
The solution explains how to calculate the equivalent units and prepare a cost reconciliation using FIFO method.