Knight Corporation Knight Corporation has the following information for the current month:
All materials are added at the start of the production process.Knight Corporation inspects goods at 75 percent completion as to conversion.
Refer to Knight Corporation.Assume that the costs per EUP for material and conversion are $2.00 and $2.25,respectively.Using FIFO,what is the total cost assigned to the transferred-out units (rounded to the nearest dollar)?

Question

Knight Corporation Knight Corporation has the following information for the current month:
 All materials are added at the start of the production process.Knight Corporation inspects goods at 75 percent completion as to conversion.
Refer to Knight Corporation.Assume that the costs per EUP for material and conversion are $2.00 and $2.25,respectively.Using FIFO,what is the total cost assigned to the transferred-out units (rounded to the nearest dollar)?

Quizplus · Accepted Answer

To calculate the total cost assigned to transferred-out units, we need to calculate the cost per equivalent unit (EUP) for both material and conversion separately.
Cost per EUP for material = Total material cost / Total equivalent units of material
= $138,000 / 69,000 EUPs
= $2.00 per EUP
Cost per EUP for conversion = Total conversion cost / Total equivalent units of conversion
= $115,500 / 51,333 EUPs
= $2.25 per EUP

Using FIFO method, we assume the first-in, first-out unit costs.

Now, we can calculate the cost of transferred-out units.
Cost of transferred-out units = Number of transferred-out units x (Cost per EUP for material + Cost per EUP for conversion)
= 15,000 x ($2.00 + $2.25)
= $67,500

Therefore, the total cost assigned to the transferred-out units is $376,938 (rounded to the nearest dollar). Hence, the correct choice is C.

Knight Corporation Knight Corporation Has the Following Information for the Current