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Wednesday, 3 October 2012

The PVC Company manufactures a high-quality plastic pipe that goes through three processing stages prior to completion.

The PVC Company manufactures a high-quality plastic pipe that goes through three processing stages prior to completion.

       Information on work in the first department, Cooking, is given below for May:

     
  Production data:    
    Pounds in process, May 1: materials
      100% complete; conversion 90% complete
  60,000   
    Pounds started into production during May   250,000   
    Pounds completed and transferred to
      the next department
  ?   
    Pounds in process, May 31:
      materials 60% complete; conversion 40% complete
  20,000   
  Cost data:    
    Work in process inventory, May 1:    
        Materials cost $ 59,000   
        Conversion cost $ 23,400   
    Cost added during May:    
        Materials cost $ 306,420   
        Conversion cost $ 128,580   


The company uses the weighted-average method.

Required:
1. Compute the equivalent units of production.

  Materials Conversion
  Equivalent units of production


2.
Compute the costs per equivalent unit for the month. (Round your answers to 2 decimal places. Omit the "$" sign in your response.)

  Materials Conversion
  Cost per equivalent unit $ $


3.
Determine the cost of ending work in process inventory and of the units transferred out to the next department. (Omit the "$" sign in your response.)

  Materials Conversion Total
  Cost of ending work in process inventory $        $       $      
  Cost of units completed and transferred out  $        $       $      


4.
Prepare a cost reconciliation report for the month. (Omit the "$" sign in your response.)

  Cost Reconciliation
  Costs to be accounted for:  
      Cost of beginning work in process inventory $  
      Costs added to production during the period  
 
  Total cost to be accounted for $  
 

  Costs accounted for as follows:  
      Cost of ending work in process inventory $  
      Cost of units completed and transferred out  
 
  Total cost accounted for $  
 




Explanation:
 

Solex Company produces a high-quality insulation material that passes through two production processes. Data for June for the first process follow:

Solex Company produces a high-quality insulation material that passes through two production processes. Data for June for the first process follow:

  Units Completion
with Respect
to Materials
Completion
with Respect
to Conversion
  Work in process inventory, June 1 76,000   75 %   40 %  
  Work in process inventory, June 30 56,000   50 %   25 %  
                
  Materials cost in work in process inventory, June 1       $ 60,000      
  Conversion cost in work in process inventory, June 1       $ 17,800      
  Units started into production         258,000      
  Units transferred to the next process         278,000      
  Materials cost added during June       $ 408,180      
  Conversion cost added during June       $ 256,680      


Required:
1.
Assume that the company uses the weighted-average method of accounting for units and costs. Determine the equivalent units for June for the first process.

  Materials Conversion
  Equivalent units of production


2.
Compute the costs per equivalent unit for June for the first process. (Round your answers to 2 decimal places. Omit the "$" sign in your response.)

  Materials Conversion
  Cost per equivalent unit $ $


3.
Determine the total cost of ending work in process inventory and the total cost of units transferred to the next process in June. (Omit the "$" sign in your response.)

  Total
  Cost of ending work in process inventory $
  Cost of units transferred to the next process $



Explanation:
 

Kalox, Inc., manufactures an antacid product that passes through two departments. Data for May for the first department follow:

Kalox, Inc., manufactures an antacid product that passes through two departments. Data for May for the first department follow:          
  Gallons Materials Labor Overhead
  Work in process, May 1 87,000       $ 84,400     $ 42,200    $ 55,900   
  Gallons started in process 829,000            
  Gallons transferred out 850,000                  
  Work in process, May 31 66,000                  
  Cost added during May   $ 1,116,480     $ 521,025    $ 689,290   

      
The beginning work in process inventory was 70% complete with respect to materials and 55% complete with respect to labor and overhead. The ending work in process inventory was 50% complete with respect to materials and 25% complete with respect to labor and overhead.
    
Required:
Assume that the company uses the weighted-average method of accounting for units and costs.
    
1. Compute the equivalent units for May’s activity for the first department.
    
    Materials   Labor  Overhead
  Equivalent units of production      

    
2. Determine the costs per equivalent unit for May. (Round your answers to 2 decimal places. Omit the "$" sign in your response.)
      
  Materials     Labor      Overhead
  Cost per equivalent unit $         $        $      



Explanation:
 

Societe Clemeau, a company located in Lyons, France, manufactures cement for the construction industry.

Societe Clemeau, a company located in Lyons, France, manufactures cement for the construction industry. Data relating to the kilograms of cement processed through the Mixing Department, the first department in the production process, are provided below for May:
 
   
Percent Completed
  Kilograms of Cement Materials Conversion
  Work in process, May 1 80,900     86% 23%
  Work in process, May 31 51,000     45% 12%
  Started into production during May 301,000        

  
Required:
1.
Compute the number of kilograms of cement completed and transferred out of the Mixing Department during May.
 
  Completed and transferred out during the month  
    
2.
Compute the equivalent units of production for materials and for conversion for May.
 
     Materials    Conversion
  Equivalent units of production        



Explanation:
 

Schneider Brot is a bread-baking company located in Aachen, Germany, near the Dutch border. The

Schneider Brot is a bread-baking company located in Aachen, Germany, near the Dutch border. The company uses a process costing system for its single product—a popular pumpernickel bread. Schneider Brot has two processing departments—Mixing and Baking. The T-accounts below show the flow of costs through the two departments in April (all amounts are in the currency euros):

Work in Process—Mixing

 
  Balance 4/1 12,000     Transferred out 760,000  
  Direct materials 326,000      
  Direct labor 256,000      
  Overhead 186,000      

Work in Process—Baking

 
  Balance 4/1 21,000     Transferred out 978,000  
  Transferred in 760,000      
  Direct labor 125,000      
  Overhead 94,000      


Required:
Prepare journal entries showing the flow of costs through the two processing departments during April. (Omit the "€" sign in your response.)

General Journal Debit Credit
  Raw materials issued.    
  Work in process-Mixing    
       Raw materials inventory    
     
  Direct labor incurred.    
  Work in process-Mixing    
  Work in process-Baking    
       Wages payable    
     
  Manufacturing overhead applied.
  Work in process-Mixing    
  Work in process-Baking    
       Manufacturing overhead    
     
  Work completed in Mixing Department.
  Work in process-Baking    
       Work in process-Mixing    
     
  Work completed in Baking Department.
  Finished goods    
       Work in process-Baking