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Magazine Chapter 18: Q45PGB (page 1024)
Preparing a production cost report, second department, withbeginning WIP and transferred in costs; journal entries; FIFO method Work Problem P18-40B using the FIFO method. The Mixing Department beginningwork in process of 400 units is 80% complete as to both direct materials and conversion costs. Round equivalent unit costs to four decimal places. Round all other costs to the nearest dollar.
Short Answer
1. Production cost report
Production Cost Report- Department 2 | ||||
Equivalent unit of production | ||||
UNITS | Physical units | Direct material | Conversion costs | Total |
Units to account for: | ||||
| 400 | |||
| 4,600 | |||
Total units to account for | 5,000 | |||
Units accounted for: | ||||
| 4,500 | 4,180 | 4,180 | |
| 500 | 100 | 100 | |
Total units accounted for | 5,000 | 4,280 | 4,280 | |
COSTS | Direct material | Conversion costs | Total costs | |
Costs to account for: | ||||
Beginning WIP | $475 | $575 | $1,050 | |
Cost added during the period | 5,045 | 5,865 | 10,910 | |
Total cost to account for | 5,520 | 6,440 | 11,960 | |
Divided by: total EUP | 4,280 | 4,280 | ||
Cost per equivalent unit | $1.29 | $1.50 | ||
Costs accounted for: | ||||
| 5,391 (4,180 x $1.29) | 6,290 (4,180x$1.50) | 11,681 | |
| 129 (100x $1.29) | 150 (100x$1.50) | 279 | |
Total costs accounted for | 5,520 | 6,440 | 11,960 | |
2. The journal entries to show the transaction affecting the mixing department are shown in step 4.
Step by step solution
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