Ahler Corporation Uses the FIFO Method in Its Process Costing

question 14

Essay

Ahler Corporation uses the FIFO method in its process costing.The following data concern the company's Assembly Department for the month of October. $\begin{array}{llcc}&\text { Materials}&\text { Conversion }\\ \text { Work in process, October 1.........................................} &\$13,870&\$12,400\\ \text {Cost added to production in the Assembly Department } &\\ \text { during Oetober............................................................} &\$23,360&\$29,760\\ \text { Equivalent units of production for October.................. } &3,650&3,100\\\end{array}$
Required:
Compute the costs per equivalent unit for the Assembly Department for October using the FIFO method.

---

Definitions:

Standard Cost Variances

The differences between the actual costs incurred and the standard costs previously set for materials, labor, and overhead in manufacturing.

Labor Efficiency Variance

The difference between the actual number of labor hours worked and the standard hours expected, multiplied by the standard labor rate.

Labor Rate Variance

The difference between the actual cost of labor and its expected cost based on standards or budgets.

Direct Labor Employees

Workers who are directly involved in the manufacturing of products, including those who operate machinery, assemble products, or perform manual labor that can be directly attributed to specific goods or services.