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:

Weighted-Average Method

1.

Equivalent units of production

	Materials	Conversion
Transferred to next department*	290,000	290,000
Ending work in process:
Materials: 20,000 units × 60% complete	12,000
Conversion: 20,000 units × 40% complete		8,000
Equivalent units of production	302,000	298,000

*Units transferred to the next department = Units in beginning work in process + Units started into production − Units in ending work in process = 60,000 + 250,000 − 20,000 = 290,000

2.

Cost per equivalent unit

	Materials		Conversion
Cost of beginning work in process	$	59,000	$	23,400
Cost added during the period		306,420		128,580
Total cost (a)	$	365,420	$	151,980
Equivalent units of production (b)		302,000		298,000
Cost per equivalent unit, (a) ÷ (b)	$	1.21	$	0.51

3.

Cost of ending work in process inventory and units transferred out

	Materials		Conversion		Total
Ending work in process inventory:
Equivalent units of production      (materials: 20,000 units × 60% complete;       conversion: 20,000 units × 40% complete)		12,000		8,000
Cost per equivalent unit	$	1.21	$	0.51
Cost of ending work in process inventory	$	14,520	$	4,080	$	18,600
Units completed and transferred out:
Units transferred to the next department		290,000		290,000
Cost per equivalent unit	$	1.21	$	0.51
Cost of units completed and transferred out	$	350,900	$	147,900	$	498,800

4.

Cost of beginning work in process inventory ($59,000 + $23,400) = $82,400

Costs added to production during the period ($306,420 + $128,580) = $435,000

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:

Weighted-Average Method
 

1.

	Materials	Conversion
Units transferred to the next process	278,000	278,000
Ending work in process:
Materials: 56,000 units × 50% complete	28,000
Conversion: 56,000 units × 25% complete		14,000
Equivalent units of production	306,000	292,000

2.

	Materials		Conversion
Cost of beginning work in process	$	60,000	$	17,800
Cost added during the period		408,180		256,680
Total cost (a)	$	468,180	$	274,480
Equivalent units of production (b)		306,000		292,000
Cost per equivalent unit (a) ÷ (b)	$	1.53	$	.94

3.

	Materials		Conversion		Total
Ending work in process inventory:
Equivalent units of production		28,000		14,000
Cost per equivalent unit	$	1.53	$	.94
Cost of ending work in process inventory	$	42,840	$	13,160	$	56,000
Units completed and transferred out:
Units transferred to the next process		278,000		278,000
Cost per equivalent unit	$	1.53	$	.94
Cost of units completed and transferred out	$	425,340	$	261,320	$	686,660

 

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:

1.

	Materials	Labor	Overhead
Units transferred to the next department	850,000	850,000	850,000
Work in process, ending:
Materials: 66,000 units × 50% complete	33,000
Labor and overhead: 66,000 units × 25% complete		16,500	16,500
Equivalent units of production	883,000	866,500	866,500

2.

	Materials		Labor		Overhead
Cost of beginning work in process	$	84,400	$	42,200	$	55,900
Costs added during the period		1,116,480		521,025		689,290
Total cost (a)	$	1,200,880	$	563,225	$	745,190
Equivalent units of production (b)		883,000		866,500		866,500
Cost per equivalent unit (a) ÷ (b)	$	1.36	$	0.65	$	0.86

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:

Weighted-Average Method

1. 

	Kilograms of Cement
Work in process, May 1	80,900
Started into production during the month	301,000
Total kilograms in process	381,900
Deduct work in process, May 31	51,000
Completed and transferred out during the month	330,900

  
2.

	Equivalent Units (EU)
	Materials	Conversion
Units transferred out	330,900	330,900
Work in process, ending:
Materials: 51,000 kilograms × 45%	22,950
Conversion: 51,000 kilograms × 12%		6,120
Equivalent units of production	353,850	337,020

 

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