The Bakersfield Company has the following information available: $\begin{array}{|l|l|l|}
\hline & \text { Costs from Begiuning Inventory } & \text { Costs from Current Period } \
\hline \text { Direct materials } & \$ 3,650 & \$ 31,620 \
\hline \text { Conversion costs } & 9,120 & 143,100 \
\hline
\end{array}$
At the beginning of the period, there were 800 units in process that were 60 percent complete as to conversion costs and 100 percent complete as to direct materials costs. During the current period, 5,800 units were started and completed. Ending inventory contained 400 units that were 60 percent complete as to conversion costs and 100 percent complete as to direct materials costs. (Assume that the company uses the FIFO process costing method.)
-
The cost of completing a unit during the current period was

Question

The Bakersfield Company has the following information available: $\begin{array}{|l|l|l|}
\hline & \text { Costs from Begiuning Inventory } & \text { Costs from Current Period } \
\hline \text { Direct materials } & \$ 3,650 & \$ 31,620 \
\hline \text { Conversion costs } & 9,120 & 143,100 \
\hline 
\end{array}$
 At the beginning of the period, there were 800 units in process that were 60 percent complete as to conversion costs and 100 percent complete as to direct materials costs. During the current period, 5,800 units were started and completed. Ending inventory contained 400 units that were 60 percent complete as to conversion costs and 100 percent complete as to direct materials costs. (Assume that the company uses the FIFO process costing method.)
-
The cost of completing a unit during the current period was

Quizplus · Accepted Answer

Under FIFO, the cost of completing a unit is calculated using only the costs incurred during the current period. The cost per unit for direct materials is $31,620 / 5,800 = $5.45, and for conversion costs is $143,100 / 5,800 = $24.65. Therefore, the total cost per unit is $5.45 + $24.65 = $30.10. However, since the question asks for the cost of completing a unit, we consider only the conversion cost for the units started and completed, which is $24.65. Adding the direct materials cost for the units started and completed, the total cost is $24.65 + $5.45 = $30.10. However, the correct choice is $27.60, which suggests a calculation error or misinterpretation in the problem setup.

The Bakersfield Company Has the Following Information Available At the Beginning of the Period, There Were 800 Units