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Chapter 18: Q.18-7SE (page 1008)

Question: The Finishing Department of Lee and Lewis, Inc., the last department in the manufacturing process, incurred production costs of \(220,000 during the month of June.If the June 1 balance in Work-in-Process Inventory鈥擣inishing is \)0 and the June 30balance is $70,000, what amount was transferred to Finished Goods Inventory?

Short Answer

Expert verified

Answer:

The amount transferred to the finished goods inventory account is $150,000

Step by step solution

01

Finished goods inventory

Finished goods inventory means the inventory which are completed in manufacturing. When the manufacturing process is completed, the WIP inventory balance of the completed goods are transferred to the finished goods inventory account.

02

Amount transferred to the finished goods inventory

Finishedgoodsinventory=BeginingbalanceofWIPInventory+Productioncostincurred-EndingbalanceofWIPInventory=$0+$220,0000-70,000=$150,000

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Most popular questions from this chapter

Question: Explain the terms to account for and accounted for.

Question: Why is the calculation of equivalent units of production needed in a process costing system?

Collins Company has the following data for the Assembly Department for August:

Unit in process at the beginning of august

900

Units started in august

2,000

Units completed and transferred

2,100

Units in process at the end of august

800

Conversion costs are added evenly throughout the process. The company uses the weighted-average method. Compute the equivalent units of production for direct materials and conversion costs for each independent scenario:

1. Units in process at the end of August are 20% complete; materials are added at the beginning of the process.

2. Units in process at the end of August are 80% complete; materials are added at the beginning of the process.

3. Units in process at the end of August are 20% complete; materials are added at the end of the process.

4. Units in process at the end of August are 80% complete; materials are added at the halfway point.

Question: Castillo Company has three departments: Mixing, Bottling, and Packaging. At the end of the month, the production cost reports for the departments show the costs of the products completed and transferred were \(75,000 from Mixing to Bottling, \)50,000 from Bottling to Packaging, and $65,000 from Packaging to Finished Goods Inventory. Prepare the journal entries for the transfer of the costs.

Question: The Mixing Department of Complete Foods had 62,000 units to account for in October. Of the 62,000 units, 38,000 units were completed and transferred to the next department, and 24,000 units were 20% complete. All of the materials are added at the beginning of the process. Conversion costs are added evenly throughout the mixing process and the company uses the weighted-average method.

Compute the total equivalent units of production for direct materials and

conversion costs for October.
See all solutions

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