FIFO and Average Costing Methods under Process Costing

Computation of FIFO and Average Costing Methods. The King Process Company manufactures one product through two processes — No. 1 and No. 2. For each unit of Process No. 1 output, 2 units of Raw Material X are put in at the start of processing. For each unit of Process No. 2 output, 3 cans of Raw Material Y are put in at the end of processing. Two pounds of Process No. 1 output are placed in at the start of Process No. 2 for each unit of finished goods started. 

Spoilage generally occurs in Process No, 2 when processing is approximately 50% complete. 

Work in process accounts are maintained for raw materials, conversion costs, and prior department costs. 

The company uses FIFO for inventory costing for Process No. 1 and average cost for inventory costing for Process No. 2.

Data for March:
(a) Units transferred:
From Process No. 1 to Process No. 2 2,200 pounds
From Process No. 2 to finished goods 900 gallons
From finished goods to cost of goods sold 600 gallons
(b) Units spoiled in Process No. 2, 100 gallons.
(c) Raw materials unit costs: X, $1.51 per unit; Y, $2 per can.
(d) Conversion costs: Process No. 1, $3,344; Process No. 2, $4,010.
(e) Spoilage recovery: $100 (treated in Process No. 2 as cost reduction which came from Process No. 1).
(f) Inventory data:                       Process No. 1           Process No. 2
                                                   Initial     Final             Initial     Final
Units                                           200       300              200       300
Fraction complete,
conversion costs                          1/2        1/3               1/2         2/3
Costs:
Materials                                  $560
Conversion costs                        108                         $ 390
Prior department costs                                               2,200

Required: A cost of production report with a quantity schedule for March.