In April, one of the processing departments at Salatino Corporation had beginning work in process inventory of $27,000 and ending work in process inventory of $36,000. During the month, the cost of units transferred out from the department was $261,000. The company uses the FIFO method in its process costing system. In the department's cost reconciliation report for April, the costs added to production in the department would be:
A)$270,000
B)$225,000
C)$252,000
D)$234,000

Question

Quizplus · Accepted Answer

The costs added to production can be calculated by adding the cost of units transferred out ($261,000) to the ending work in process inventory ($36,000) and then subtracting the beginning work in process inventory ($27,000). This gives $261,000 + $36,000 - $27,000 = $270,000.

In April, One of the Processing Departments at Salatino Corporation