Refer to the information from Problem 6.46.
Information from Problem 6.46
Physical Units
Beginning WIP (25% complete) ……………………………………………11,000
Started during January ……………………………………………………..74,000
Total to account for ……………………………………………………….85,000
Good units completed and transferred out during current period:
From beginning work in process …………………………………………11,000
Started and completed ……………………………………………………50,000
Spoiled units………………………………………………………………….8,000
Ending WIP (75% complete) ……………………………………………….16,000
Total accounted for ………………………………………………………..85,000
Costs
Beginning WIP:
Direct materials ………………………………………………………..$220,000
Conversion costs …………………………………………………………30,000
Total beginning WIP ……………………………………………………..250,000
Costs added during current period:
Direct materials ………………………………………………………1,480,000
Conversion costs ……………………………………………………….942,000
Costs to account for ………………………………………………..$2,672,000
REQUIRED
A. Explain how a standard cost report would differ from a FIFO cost report.
B. Under what circumstances would a standard cost report be preferable to a FIFO cost report? Explain your answer.
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