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Problem 1: Tiger Co. uses FIFO method of process costing to account for the production of canned food. Beginning inventory for January consisted of 4,000 units that were 40% completed. Direct materials are added at the beginning of the process and conversion costs are incurred uniformly throughout the process. 10,000 units were started into the process during January. During January 12,000 units were completed. Ending inventory still in the process at the end of January consisted of 2,000 units that were 80% completed. Beginning inventory consisted of $7,200 in materials and $2,240 in conversion costs. January costs were $20,000 for materials and $18,000 for conversion costs. The cost per unit using the FIFO method would be
Select one:
a. $3.50 b. $2.00 c. $1.50 d. $3.43
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