AC420 Unit 4 FIFO Process Costing Worksheet Example

Reviewed by Chester Goodwin, MBA Cost Accounting Purdue University Global Free custom sample in 24 to 48h

Three inputs entering a seasoning line at different points shape the equivalent units in this AC420 Unit 4 process costing worksheet. Purdue Global AC 420, Cost Accounting, asks BS in Accounting students to compute equivalent units under one stated flow assumption. At Bellhaven Iron Works, a composite cookware maker, castings arrive at the start, oil and oven time accrue along the line, and boxes go on at the end. Under first-in, first-out, equivalent units are 36,000, 37,500 and 37,000, and costs per unit are $4.95, $2.50 and $1.40. Of $343,510 to account for, $323,410 transfers to finished goods and $20,100 stays in process, and a weighted-average check differs by $263.82.

CourseAC420 Cost Accounting
UnitUnit 4
Paper typeProcess costing worksheet
LengthAbout 560 words, 5 pages double-spaced
FormatAPA 7 student paper
SchoolPurdue University Global
ProgramBS in Accounting
UpdatedOctober 2026

Free sample paper for AC420 Unit 4

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Castings In, Oil Along the Line, a Box at the End: A Unit 4 FIFO Process Costing Worksheet for a Seasoning Line

[Student Name]

Purdue University Global

AC420: Cost Accounting

Unit 4 Process Costing Worksheet

[Instructor Name]

[Date]

Bellhaven Iron Works and every figure are composite; the textbooks and standard cited are real.

What this part is doingNaming the three inputs and the flow assumption in the lead shows the worksheet's logic before its figures.
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Data for March, Seasoning Department

1. Beginning work in process: 4,000 skillets, 40 percent complete for conversion; transferred-in cost $17,600 and conversion cost $2,160.

2. Transferred in from the foundry: 36,000 castings at $4.95, $178,200.

3. Conversion costs added: $93,750. Packaging costs added: $51,800.

4. Completed and transferred to finished goods: 37,000. Ending work in process: 3,000, 70 percent complete for conversion.

5. Boxes are added at completion.

Schedule 1: Physical Flow (FIFO)

Units to account for: 4,000 beginning plus 36,000 transferred in, 40,000. Units accounted for: 4,000 beginning units completed, 33,000 started and completed, 3,000 in ending work in process, 40,000.

Schedule 2: Equivalent Units (FIFO)

1. Transferred-in: beginning units need none, 33,000 started and completed, 3,000 ending: 36,000.

2. Conversion: 4,000 x 60 percent still needed, 2,400; 33,000; 3,000 x 70 percent, 2,100: 37,500.

3. Packaging: 4,000; 33,000; ending units, none: 37,000.

Under first-in, first-out, beginning units receive only the 60 percent of conversion and the box they still needed, so their earlier cost of $19,760 travels with them and never enters this month's rates.

What this part is doingThe highlighted sentence explains the defining step of the FIFO method, the point graders check first.
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Schedule 3: Cost per Equivalent Unit (current costs only)

1. Transferred-in: $178,200 / 36,000 = $4.95.

2. Conversion: $93,750 / 37,500 = $2.50.

3. Packaging: $51,800 / 37,000 = $1.40.

Schedule 4: Costs to Account For

Beginning work in process $19,760 plus current costs $323,750, total $343,510.

Schedule 5: Assignment of Costs

Completed and transferred out:

1. Beginning units: prior cost $19,760, plus conversion 2,400 x $2.50, $6,000, plus packaging 4,000 x $1.40, $5,600: $31,360.

2. Started and completed: 33,000 x $8.85: $292,050.

Total transferred out: $323,410.

Ending work in process: transferred-in 3,000 x $4.95, $14,850, plus conversion 2,100 x $2.50, $5,250: $20,100.

Total accounted for: $343,510. Schedules 4 and 5 agree.

Reading the Result

A finished skillet leaving seasoning this month carries $8.85 of current cost: $4.95 for the casting, $2.50 for oil and oven time and $1.40 for the box. The 4,000 beginning units cost $7.84 each, because most of their casting cost was incurred last month at the lower foundry price. A supervisor judged on this department's own costs should be measured on the $2.50 of conversion, the only part the seasoning line controls; the casting price is set upstream.

Check Against Weighted Average

Weighted-average equivalent units: transferred-in 40,000, conversion 39,100, packaging 37,000. Costs per unit: $195,800 / 40,000 = $4.895; $95,910 / 39,100 = $2.4529; $1.40. Ending work in process: $14,685 plus $5,151.18, $19,836.18. Transferred out: $323,673.82.

The two methods differ by $263.82 in ending inventory. The gap is small because beginning inventory is small relative to the month, though castings rose from $4.40 to $4.95. First-in, first-out shows this month's performance alone, which suits a supervisor's report; weighted average blends periods (Datar & Rajan, 2021). Either method values inventory acceptably for outside reporting, because the cost of goods on hand must include the cost of bringing them to their present condition (Financial Accounting Standards Board, n.d.). The five schedules follow the production cost report layout most texts teach (Garrison et al., 2021).

What this part is doingEnding on why the methods differ and which suits which reader ties the arithmetic to its use.
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References

Datar, S. M., & Rajan, M. V. (2021). Horngren's cost accounting: A managerial emphasis (17th ed.). Pearson.

Financial Accounting Standards Board. (n.d.). Accounting Standards Codification Topic 330: Inventory. FASB.

Garrison, R. H., Noreen, E. W., & Brewer, P. C. (2021). Managerial accounting (17th ed.). McGraw Hill.

The Purdue Global AC420 Unit 4 instructions

The fourth AC420 unit asks for a process costing worksheet that computes equivalent units under a stated flow assumption. State the method in every schedule heading. Reconcile physical units first: beginning inventory and units started against units completed and ending inventory. Compute equivalent units for each input according to when it enters the process, giving beginning units under first-in, first-out only the work they still needed. Divide current-period costs by current-period equivalent units for each input. Account for all costs, assigning beginning inventory costs to the units they belong to, then costing units started and completed and ending work in process. Prove that costs to account for equal costs accounted for. Where useful, compare the result with weighted average and explain the difference. Cite the textbook and the inventory standard in APA 7.

How this AC420 Unit 4 example is built

The sample states March's data in five numbered lines. Schedule 1 reconciles 40,000 units. Schedule 2 computes equivalent units input by input, with beginning units receiving 60 percent of conversion and their boxes. The highlighted sentence explains that beginning costs of $19,760 travel with their units and stay out of the rates. Schedules 3 to 5 compute $4.95, $2.50 and $1.40, account for $343,510, and assign $31,360 to beginning units, $292,050 to units started and completed and $20,100 to ending work in process. A section on reading the result explains why beginning units cost $7.84 each and what a supervisor controls. The weighted-average check yields $19,836.18, a difference of $263.82, explained by small beginning inventory, with Datar and Rajan, the FASB codification and Garrison and colleagues cited.

Reading the AC420 Unit 4 grading rubric

AC420 process costing worksheets are graded on accurate equivalent units and correct treatment of beginning inventory. The flow assumption must be stated and applied consistently. Each input should be treated by its point of entry, and an input added at the end must count nothing for ending work in process. Under first-in, first-out, rates must use current-period costs only, and beginning inventory must be costed separately from units started and completed. The proof that costs balance is required. Graders reward worksheets that explain, in a sentence, why a figure takes its value, such as why packaging counts no ending units. Comparing methods and explaining the size of the difference shows understanding beyond mechanics. A layout matching the production cost report and APA 7 citations to the textbook complete the marks for this Purdue Global unit.

AC420 Unit 4 help from the desk

Unit 4 worksheets often mix methods, using weighted-average equivalent units with first-in, first-out costs. Beginning units are given full conversion credit again under first-in, first-out. Inputs added at the end are counted for ending work in process. Transferred-in costs are left out or treated as partly complete. Beginning inventory costs are folded into the current rates. Rounding errors are not reconciled, so costs fail to balance. The comparison with weighted average is skipped or the difference is not explained. If your problem has spoilage, multiple departments or a different entry point for materials, our writers can build the schedules for that flow and your stated method.

Get an AC420 Unit 4 example written to your instructions

The Unit 4 problem's unit counts, completion percentages and costs by input decide everything here, so include them along with the flow assumption your instructions require and the rubric. Worked on those figures, the schedules reconcile to the dollar, with a second method shown only if the prompt calls for it. Expect it in 24-48h; the first custom sample is free. The paper above is an original model document written by our desk, not a submitted student paper and not an official Purdue University Global document.

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AC420 Unit 4 questions, answered

Why is the difference between the two methods so small?

Because beginning inventory is small relative to the month's output and its unit costs sit close to this month's. The two methods drift apart when beginning work is large or input prices moved sharply between periods. Here castings rose from 4.40 to 4.95 dollars, yet the effect on ending inventory is only 263.82, which the worksheet states rather than inflating.

How does spoilage change the worksheet?

If castings fail inspection partway down the line, the spoiled units get their own row in the physical flow and their own equivalent units up to the inspection point. Normal spoilage cost is then assigned to the good units that passed inspection, and abnormal spoilage goes to a loss account. The sample adds that row when the problem includes rejects, keeping it visible rather than netting it away.

Does the worksheet need a production cost report format?

If the course uses one, yes, and the sample follows its layout. The five schedules map onto the standard report: physical units, equivalent units, costs to account for, cost per equivalent unit and costs accounted for. Some AC420 sections prefer a single spreadsheet with formulas visible; others accept a typed report. Mention which one your section uses.

Where can I find a free AC420 Unit 4 sample paper?

This page holds a complete AC420 Unit 4 FIFO process costing worksheet for a composite cookware seasoning line, with five schedules, a cost proof, a weighted-average check and APA 7 references.

Why do boxes count no ending units in AC420 Unit 4?

Boxes are added only when a skillet is completed. The 3,000 skillets still on the line at month end have no box yet, so they carry no packaging cost or packaging equivalent units.