Honesty Manufacturing Company manufactures a standard recliner. During December, the firm’s Assembly Department started production of 75,000 chairs. During the month, the firm completed 80,000 chairs...

Honesty Manufacturing Company manufactures a standard recliner.  During December, the firm’s Assembly Department started production of 75,000 chairs.  During the month, the firm completed 80,000 chairs and transferred them to the Finishing Department.  The firm ended the month with 10,000 chairs in ending inventory that are 80% completed.  There were 15,000 chairs in beginning inventory that are 30% completed.  All direct materials costs are added at the beginning of the production cycle, and conversion costs are added uniformly throughout the process.  The FIFO method is used.


                                          Direct Materials       Conversion Costs
Beginning inventory              P   84,000                   P 122,500
Costs added                             588,000                       970,270


The cost of the units completed during December is