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  • Example Fifo Method

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    Vyomesh Ranjan
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    The document illustrates the FIFO (first-in, first-out) method using data from the shaping and milling department of Five Star Company. It shows beginning work in process of 200 units that were 55% and 30% complete, units started and completed in May of 4,600, and ending work in process of 400 units that were 40% and 25% complete. The equivalent units of production using the FIFO method were 4,850 for materials and 4,840 for conversion.

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    EXAMPLE FIFO METHOD

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    The document illustrates the FIFO (first-in, first-out) method using data from the shaping and milling department of Five Star Company. It shows beginning work in process of 200 units that were 55% and 30% complete, units started and completed in May of 4,600, and ending work in process of 400 units that were 40% and 25% complete. The equivalent units of production using the FIFO method were 4,850 for materials and 4,840 for conversion.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    87 views1 page

    Example Fifo Method

    Uploaded by

    Vyomesh Ranjan
    The document illustrates the FIFO (first-in, first-out) method using data from the shaping and milling department of Five Star Company. It shows beginning work in process of 200 units that were 55% and 30% complete, units started and completed in May of 4,600, and ending work in process of 400 units that were 40% and 25% complete. The equivalent units of production using the FIFO method were 4,850 for materials and 4,840 for conversion.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 1

    Example:

    To illustrate the FIFO method, refer again the data of shaping and milling department of Five Star
    Company.

    Shaping and Milling Department Materials Conversion


    Work in Process May 1:  
    200 units × (100% − 55%)* 90
    200 units × (100% − 30%)* 140
    Units started and completed in May **4,600 **4,600
    Work in process, May 31:
    400 units × 40% 160
    400 units × 25% 100
    -------- --------
    Equivalent Units of Production 4,850 4,840
    ===== =====

    *This is the work needed to complete the units in the beginning inventory.
    ** (5,000 units started) − (400 units in the ending work in process) = 4,600 units started
    and  completed. The FIFO method assumes that the units in the beginning inventory are finished first.

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