Liquid Extracts Company produces a line of fruit extracts for home use in making wine, jams and jellies, pies, and meat sauces. Fruits enter the production process in pounds; the product emerges in quarts (1 pound of input equals 1 quart of output). On May 31, 4,250 units were in process. All direct materials had been added, and the units were 70 percent complete for conversion costs. Direct materials costs of $4,607 and conversion costs of $3,535 were attached to the units in beginning work in process inventory. During June, 61,300 pounds of fruit were added at a cost of $71,108. Direct labor for the month totaled $19,760, and overhead costs applied were $31,375. On June 30, 3,400 units remained in process. All direct materials for these units had been added, and 50 percent of conversion costs had been incurred.
Please help me with the following:
1. Using the FIFO costing method, prepare a process cost report for June.
2. From the information in the process cost report, identify the amount that should be transferred out of the Work in Process Inventory account, and state where those dollars should be transferred.
FIFO costing methods are examined. The conversions costs which have been incurred are determined.