Problem 20-3A Journalizing in process costing; equivalent units and costs L.O. C2, P1, P2, P3
[The following information applies to the questions displayed below.]Li Company produces large quantities of a standardized product. The following information is available for its production activities for January. |
Raw materials | Factory overhead incurred | ||||||
Beginning inventory | $ | 19,000 | Indirect materials used | $ | 81,000 | ||
Raw materials purchased (on credit) | 315,000 | Indirect labor used | 50,000 | ||||
Direct materials used | (172,000 | ) | Other overhead costs | 151,380 | |||
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Indirect materials used | (81,000 | ) | Total factory overhead incurred | $ | 282,380 | ||
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Ending Inventory | $ | 81,000 | |||||
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Factory overhead applied | |||||||
Factory payroll | (140% of direct labor cost) | ||||||
Direct labor used | $ | 201,700 | Total factory overhead applied | $ | 282,380 | ||
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Indirect labor used | 50,000 | ||||||
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Total payroll cost (paid in cash) | $ | 251,700 | |||||
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Additional information about units and costs of production activities follows. |
Units | Costs | ||||||
Beginning goods in process inventory | 2,400 | Beginning goods in process inventory | |||||
Started | 24,000 | Direct materials | $ | 3,500 | |||
Ending goods in process inventory | 5,200 | Direct labor | 2,900 | ||||
Factory overhead | 3,800 | ||||||
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$ | 10,200 | ||||||
Status of ending goods in process inventory | Direct materials added | 172,000 | |||||
Materials—Percent complete | 80 | % | Direct labor added | 201,700 | |||
Labor and overhead—Percent complete | 75 | % | Overhead applied (140% of direct labor) | 282,380 | |||
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Total costs | $ | 666,280 | |||||
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Ending goods in process inventory | $ | 105,032 | |||||
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During January, 18,000 units of finished goods are sold for $140 cash each. Cost information regarding finished goods follows.
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Beginning finished goods inventory | $ | 160,000 | |
Cost transferred in | 561,248 | ||
Cost of goods sold | (606,390 | ) | |
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Ending finished goods inventory | $ | 114,858 | |
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Section Break | Problem 20-3A Journalizing in process costing; equivalent units and costs L.O. C2, P1, P2, P3 |
6.
award:
10 out of
10.00 points
10 out of
10.00 points
Problem 20-3A Part 1
Required: | |
1(a) |
Prepare journal entry dated January 31 to record the purchase of raw materials. (Omit the "$" sign in your response.)
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Date | General Journal | Debit | Credit |
Jan. 31 | Raw materials inventory | 315,000 | |
Accounts payable | 315,000 | ||
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1(b) |
Prepare journal entry dated January 31 to record the direct materials usage. (Omit the "$" sign in your response.)
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Date | General Journal | Debit | Credit |
Jan. 31 | Goods in process inventory | 172,000 | |
Raw materials inventory | 172,000 | ||
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1(c) |
Prepare journal entry dated January 31 to record the indirect materials usage. (Omit the "$" sign in your response.)
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Date | General Journal | Debit | Credit |
Jan. 31 | Factory overhead | 81,000 | |
Raw materials inventory | 81,000 | ||
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1(d) |
Prepare journal entry dated January 31 to record the factory payroll costs. (Omit the "$" sign in your response.)
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Date | General Journal | Debit | Credit |
Jan. 31 | Factory payroll | 251,700 | |
Cash | 251,700 | ||
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1(e) |
Prepare journal entry dated January 31 to record the direct labor costs used in production. (Omit the "$" sign in your response.)
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Date | General Journal | Debit | Credit |
Jan. 31 | Goods in process inventory | 201,700 | |
Factory payroll | 201,700 | ||
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1(f) |
Prepare journal entry dated January 31 to record the indirect labor costs. (Omit the "$" sign in your response.)
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Date | General Journal | Debit | Credit |
Jan. 31 | Factory overhead | 50,000 | |
Factory payroll | 50,000 | ||
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1(g) |
Prepare journal entry dated January 31 to record the other overhead costs—credit Other Accounts. (Omit the "$" sign in your response.)
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Date | General Journal | Debit | Credit |
Jan. 31 | Factory overhead | 151,380 | |
Other accounts | 151,380 | ||
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1(h) |
Prepare journal entry dated January 31 to record the overhead applied. (Omit the "$" sign in your response.)
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Date | General Journal | Debit | Credit |
Jan. 31 | Goods in process inventory | 282,380 | |
Factory overhead | 282,380 | ||
|
1(i) |
Prepare journal entry dated January 31 to record the goods transferred to finished goods. (Omit the "$" sign in your response.)
|
Date | General Journal | Debit | Credit |
Jan. 31 | Finished goods inventory | 561,248 | |
Goods in process inventory | 561,248 | ||
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1(j) |
Prepare journal entries dated January 31 to record the sale of finished goods. (Omit the "$" sign in your response.)
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Date | General Journal | Debit | Credit |
Jan. 31 | Cash | 2,520,000 | |
Sales | 2,520,000 | ||
Cost of goods sold | 606,390 | ||
Finished goods inventory | 606,390 | ||
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Worksheet | Problem 20-3A Part 1 |
7.
award:
9.57 out of
11.00 points
9.57 out of
11.00 points
Problem 20-3A Part 2
2. |
Prepare a process cost summary report for this company, showing costs charged to production, units cost information, equivalent units of production, cost per EUP, and its cost assignment and reconciliation. (Due to rounding of cost per unit, the total costs accounted for in the cost summary may not equal to sum of all the costs given in the problem. Round your cost per EUP answers to 2 decimal places and consider the same in the other calculations. Round other answers to the nearest dollar amount. Omit the "$" sign in your response.)
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LI COMPANY | ||
Process Cost Summary | ||
For Month Ended January 31 | ||
Costs Charged to Production | ||
Costs of beginning goods in process | ||
Direct materials | $ | |
Direct labor | ||
Factory overhead | ||
| ||
$ 10,200 | ||
Costs incurred this period | ||
Direct materials | $ | |
Direct labor | ||
Factory overhead | ||
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656,080 | ||
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Total costs to account for | $ 666,280 | |
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Unit cost information | |||
Units to account for | Units accounted for | ||
Beginning goods in process | Completed & transferred out | ||
Units started this period | Ending goods in process | ||
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Total units to account for | 26,400 | Total units accounted for | 26,400 |
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Equivalent units of production | Direct Materials | Direct Labor | Factory Overhead |
Units completed & transferred out | 21,200 EUP | 21,200 EUP | 21,200 EUP |
Units of ending goods in process | 4,160 EUP | 3,900 EUP | 3,900 EUP |
| | | |
Equivalent units of production | 25,360 EUP | 25,100 EUP | 25,100 EUP |
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Cost per EUP | Direct Materials | Direct Labor | Factory Overhead | ||||||
Cost of beginning goods in process | $ | 3,500 | $ | 2,900 | $ | 3,800 | |||
Costs incurred this period | 172,000 | 201,700 | 282,380 | ||||||
| | | | | | | | | |
Total costs | $ | 175,500 | $ | 204,600 | $ | 286,180 | |||
Equivalent units of production | 25,360 | EUP | 25,100 | EUP | 25,100 | EUP | |||
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Cost per EUP | $ | 6.92 | Per EUP | $ | 8.15 | Per EUP | $ | 11.40 | Per EUP |
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Cost assignment and reconciliation | ||
Costs transferred out | ||
Direct materials | $ | |
Direct labor | ||
Factory overhead | ||
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$ 561,235 | ||
Costs of ending goods in process | ||
Direct materials | $ | |
Direct labor | ||
Factory overhead | ||
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105,045 | ||
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Total costs to account for | $ 666,280 | |
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Worksheet | Problem 20-3A Part 2 |
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