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					(EX 20-3)
Domino Foods, Inc.,manufactures a sugar product by a continuous process, involving
three production departments--Refining, stiffing, and Packing. Assume that records
indicate that direct materials, direct labor, and applied factory overhead for the first
department, Refining, were $355,000, $132,000, and 93,600, respectfully. Also, work in
process at the end of the period totaled $31,200.

Journalize the entries to record (a) the flow of cost into the Refining Department during
the period for (1) direct materials, (2) direct labor, and (3) factory overhead, and (b) the
transfer of production cost to the second department, Stiffing.

(EX 20-4)
The chief cost accountant for Crystal Spring Beverage Co. estimated that total factory
overhead cost for Blending Department for the coming fiscal year begging March 1
would be $455,000 and total direct labor cost would be $325,000. During March, the
actual direct labor cost totaled $27,000, and factory overhead cost incurred totaled
$36,000.

a. What is the predetermined factory overhead rate based on direct labor cost?
b. Journalize the entry to apply factory overhead to production for March.
c. What is the March 31 balance of the account Factory Overhead--Blending
Department?
d. Does the balance in part (c) represent over applied or under applied factory overhead?

(EX 20-11)
The charges to work in process--Assembly Department for a period, together with
information concerning production, are as follows. All direct materials are placed in
process at the begging of production.

WORK IN PROCESS--ASSEMBLY DEPARTMENT
Bal.,3,000 units, 40% completed 8,550 &nbs p; To Finished Goods, 62,500 units ?
Direct labor 103,850
Factory overhead 145,300
Bal. ? units, 25% completed ?

Determine the following:

a.The number of units in work in process inventory at the end of the period.
b.Equivalent units of production for direct materials and conversion.
c.Cost per equivalent unit for direct materials and conversion.
d.Cost of the units started and completed during the period.

(EX 20-12)
a.based upon the data in Exercise 20-11, determine the following:
1.Cost of begging work in process inventory completed this period.
2.Cost of units transferred to finished goods during the period.
3.Cost of ending work in process inventory.
4.Cost per unit of begging work in process completed during the period.
b.Did the production cost change from preceding period? Explain.
c.Assuming that the direct materials cost per unit did not change from the preceding
period, did the conversion cost per equivalent unit increase, decrease, or remain the same
for the current period?

(EX 20-16)
The debits to Work In Process--Cooking Department for Yankee Bean Company for
March 2008, together with information concerning production, are as follows:
Work in process, March 1, 3,000 pounds, 30% completed $ 14,160*
*Direct materials (3000 x $4,000) $12,000
Conversion (3,000 x 30% x $2.40) 2,160
&nbs p; &nbs p; $14,160
Beans added during March, 85,900 pounds 352,190
Conversion cost during March &n bsp; 192,242
Work in process, March 31, 5,700 pounds, 25% completed ?
Goods finished during, March, 83,200 pounds ?
All direct materials are placed in process at the begging of production. Prepare a cost of
production report, presenting the following computations:

a.Direct materials and conversion equivalent units of production for March.
b.Direct materials and conversion cost per equivalent unit for March.
c.Cost of goods finished during March.
d.Cost of work in process at March 31, 2008

(EX 20-17)
Prepare a cost of production report for the Cutting Department of Aladdin Carpet
Company for May 2008, using the following data and assuming that all Materials are
added at the begging of the process:

Work in process, May 1, 5,000 units, 75% completed
*Direct materials(5,000 x $6,000) $30,000 &nb sp; $ 49,800
Conversion (5,000 x 75% x $ 5.28) 19,800
*49,800
Materials added during May from Weaving Department, 186,000units 1,134,600
Direct labor for may &nbs p; &nbs p; 405,600
Factory Overhead for May &nbs p; &nbs p; 540,436
Goods finished during May (includes goods in process, May 1), 183,400 units
Work in process, May 31, 7,600 units, 30% completed

(Ex 20-18)
Titanium Metals Inc. casts blades for turbine engines. Within the Casting Department,
alloy in first melted in a crucible, then poured into molds to produce the castings. On
October 1, there were 700 pounds of alloy in process, which were 60% complete as to
conversion. The Work in Process balance for these 700 pounds was $45,920, determined
as follows:
Direct materials (700x $47) 32,900
Conversion (700 x 60% x $31) 13,020
&nbs p; 45,930

During October, the Casting Department was charged $441,000 for 9,000 pounds of alloy
and $108,000 for direct labor. Factory overhead is applied to the department at a rate of
150% of direct labor. The department transferred out 9,200 pounds of finished castings to
theMachining Department. The October 31 inventory in process was 44% complete as to
conversion.

a.Prepare the following October Journal entries for the Casting Department:
1.The materials charged to production.
2.The conversion cost charged to production.
3.The completed production transferred to the Machining Department.
b.Determine the Work in Process--Casting Department October 31 balance.

(EX 20-19)
Papyrus Paper Company manufactures newsprint. The product is manufactured in two
departments, Paper making and Converting. Pulp is first placed into a vessel at the
beginning of paper making production. The following information concerns production in
the Paper making Department for July.

ACCOUNT Work In Process-- Paper making Department &nbs p; &nbs p; ACCOUNT
NO.
&nbs p; &nbs p; &nbs p; &nbs p; Balance
DATE &nbs p; Item Debit Credit Debit Credit
July 1 Bal.,5,000 units completed &nbs p; &nbs p; 24500
31 Direct materials, 68,000 Units 306,000 ; 330,000
31 Direct labor &nbs p; 100,000 430,500
31 Factory overhead &nb sp; 61,000 491,000
31 Goods transferred, 65,000 units &nbs p; ? ?
31 Bal.,8,000 units, 75% completed &nbs p; &nbs p; ?

a. Prepare the following July journal entries for the Paper making Department:
1.The materials charges to production.
2.The conversion cost charged to production.
3.The completed production transferred to the Converting Department.
b.Determine the Work in Process--Paper making department July 31 balance

Ex. 20–3

a.   1. Work in Process—Refining Department .........................                         355,000
          Materials........................................................................             355,000
     2. Work in Process—Refining Department .........................                         132,000
          Wages Payable ..............................................................                  132,000
         3. Work in Process—Refining Department .........................                            93,600
              Factory Overhead—Refining Department ................                                                    93,600

b.       Work in Process—Sifting Department ...................................                     574,900*
           Work in Process—Refining Department .........................                                           574,900
         *$25,500 + $355,000 + $132,000 + $93,600 – $31,200



Ex. 20–4
a. Factory overhead rate:
             $455,000 ÷ $325,000 = 140%
b.       Work in Process—Blending Department ...............................                         37,800
           Factory Overhead—Blending Department ......................                                                 37,800
               $27,000 × 140% = $37,800
c.       $1,800 credit

d.       Overapplied factory overhead


Ex. 20–11

a.
         Units in process at beginning of period ....................................................               3,000
         Units placed in production during period ...............................................                  67,000
         Less units finished during period .............................................................          (62,500)
         Units in process at end of period ..............................................................           7,500

b.
                                 A                                    B                   C             D
                                                                                         Equivalent Units
                                                                                        Direct
                                                               Whole Units                          Conversion
                                                                                       Materials
         Inventory in process, beginning
     1                                                              3,000                       0              1,800       1
           (40% completed)
     2   Started and completed                                     59,500*               59,500               59,500       2
     3   Transferred to finished goods                             62,500                59,500               61,300       3
     4   Inventory in process, ending                               7,500                 7,500                1,875       4
     5   Total units                                               70,000                67,000               63,175       5
     6   *62,500 – 3,000                                                                                                   6

c.
                                            A                                                  B           C
                                                                                                  Costs
                                                                                     Direct Materials Conversion
     1   Total costs for period in Assembly Department                                  $ 103,850       $202,160*         1
     2   Total equivalent units (from above)                                            / 67,000        / 63,175          2
     3   Cost per equivalent unit                                                       $    1.55       $ 3.20            3
     4   *$145,300 + $56,860                                                                                              4


d.       $282,625 [($1.55 + $3.20) × 59,500 units]


Ex. 20–12

a.       1. $14,310; determined as follows:
              Beginning work in process balance ........................................................           $ 8,550
              Conversion costs incurred during period
                (1,800 equivalent units × $3.20) .........................................................           5,760
              Cost of beginning work in process completed during period                                            $14,310

         2. Cost of beginning work in process .........................................................           $ 14,310
            Cost of units started and completed during period ..............................                        282,625*
            Cost of units transferred to finished goods during period ...................                          $296,935
             *($1.55 + $3.20) × 59,500 units

         3. $17,625; determined as follows:
             Direct materials ($1.55 × 7,500 units) ....................................................           $11,625
             Conversion costs ($3.20 × 1,875 equivalent units) ................................                      6,000
             Cost of ending work in process inventory .............................................                $17,625
         Note: The cost of ending work in process is also the ending balance of Work in
         Process—Assembly Department.

         4. $4.77 ($14,310/3,000 units)

b.       Yes. The production costs per unit decreased during the current period. We
         know this because the cost per unit of the units started and completed during
         the period is $4.75 ($1.55 + $3.20). Since the cost per unit of the beginning work
         in process completed during the period is $4.77 [see part (4) above], the
         production costs during the current period must have decreased.

c.       The conversion cost in the current period decreased by $0.05 per equivalent
         unit; determined as follows:
         Beginning work in process ............................................................................     $8,550
    Deduct direct materials cost incurred in prior period
       ($1.55 × 3,000 units) .................................................................................           4,650
    Conversion costs incurred in prior period ..................................................                        $3,900
    Prior period conversion cost per equivalent unit
       [$3,900/(3,000 units × 0.40)] ....................................................................                  $3.25
    Less current period conversion cost per equivalent unit ...........................                                     3.20
    Decrease in conversion cost per equivalent unit during
       current period ..........................................................................................           $0.05


Ex. 20–16

                               A                                        B                      C                    D
                                      YANKEE BEAN COMPANY
                            Cost of Production Report—Cooking Department
                                  For the Month Ended March 31, 2008
                                                                                  Equivalent Units
                                                                           Direct Materials Conversion
                    Units                                      Whole Units        (a)            (a)
 1 Units charged to production:                                                                                                  1
 2 Inventory in process, March 1                                    3,000                                                        2
 3 Received from materials storeroom                               85,900                                                        3
      Total units accounted for by the
 4                                                                 88,900                                                        4
      Cooking Department
 5 Units to be assigned cost:                                                                                                    5
      Inventory in process, March 1
 6                                                                   3,000                         0               2,1001        6
      (30% completed)
 7 Started and completed in March                                  80,2002                80,200                   80,200        7
      Transferred to finished goods in
 8                                                                 83,200                 80,200                   82,300        8
         March
      Inventory in process, March 31
 9                                                                   5,700                  5,700                  1,4253        9
      (25% completed)
10 Total units to be assigned cost                                 88,900                 85,900                   83,725     10
11 170% × 3,000                                                                                                               11
12 285,900 – 5,700                                                                                                            12
13 325% × 5,700                                                                                                               13


                                 A                                           B                  C                   D
                                                                                            Costs
                              Costs                                       Direct            Conversion             Total
                                                 Materials
 1 Unit costs:                                                                           1
      Total costs for March in Cooking
 2                                               $352,190      $194,242                  2
      Department
 3 Total equivalent units                        / 85,900      / 83,725                  3
 4 Cost per equivalent unit (b)                  $   4.10      $   2.32                  4
 5 Costs charged to production:                                                          5
 6 Inventory in process, March 1                                            $ 14,160     6
 7 Costs incurred in March                                                   546,4321    7
      Total costs accounted for by the
 8                                                                          $560,592     8
      Cooking Department
   Costs allocated to completed and
 9                                                                                       9
   partially completed units:
10 Inventory in process, March 1 balance                                    $ 14,160    10
     To complete inventory in process,
11                                               $        0    $ 4,8722        4,872    11
     March 1
12 Started and completed in March                 328,8203     186,0644      514,884    12
      Transferred to finished goods in March
13                                                                          $533,916    13
        (c)
14 Inventory in process, March 31 (d)                23,3705       3,3066     26,676    14
      Total costs assigned by the Cooking
15                                                                          $560,592    15
      Department
   1
16 $352,190 + $194,242                                                                  16
17 22,100 units × $2.32                                                                 17
18 380,200 units × $4.10                                                                18
19 480,200 units × $2.32                                                                19
20 55,700 units × $4.10                                                                 20
21 61,425 units × $2.32                                                                 21


Ex. 20–17

                     A                           B             C               D
                           ALADDIN CARPET COMPANY
                   Cost of Production Report—Cutting Department
                          For the Month Ended May 31, 2008
                                                             Equivalent Units
                   Units                  Whole Units Direct Materials Conversion
 1 Units charged to production:                                                          1
 2 Inventory in process, May 1                   5,000                                   2
 3 Received from Weaving                       186,000                                   3
      Department
      Total units accounted for by the
 4                                           191,000                                    4
      Cutting Department
 5 Units to be assigned cost:                                                           5
      Inventory in process, May 1
 6                                            5,000               0          1,2501     6
      (75% completed)
 7 Started and completed in May              178,4002        178,400        178,400     7
      Transferred to finished goods in
 8                                           183,400         178,400        179,650     8
         May
      Inventory in process, May 31
 9                                            7,600           7,600          2,2803     9
      (30% completed)
10 Total units to be assigned cost           191,000         186,000        181,930    10
11 125% × 5,000                                                                        11
12 2183,400 – 5,000, or 186,000 – 7,600                                                12
13 330% × 7,600                                                                        13


                       A                           B              C           D
                                                              Costs
                                                Direct
                     Costs                                   Conversion      Total
                                               Materials
 1 Unit costs:                                                                          1
     Total costs for May in Cutting
 2                                             $1,134,600     $946,036                  2
        Department
 3 Total equivalent units                      / 186,000      / 181,930                 3
 4 Cost per equivalent unit                    $    6.10      $    5.20                 4
 5 Costs charged to production:                                                         5
 6 Inventory in process, May 1                                            $ 49,800      6
 7   Costs incurred in May                                                              7
                                                                          2,080,6361
     Total costs accounted for by the                                      $
 8                                                                                      8
     Cutting Department                                                    2,130,436
   Costs allocated to completed and
 9                                                                                      9
   partially completed units:
10 Inventory in process, May 1 balance                                    $ 49,800 10
     To complete inventory in process, May
11                                             $        0     $ 6,5002         6,500 11
        1
12 Started and completed in May                 1,088,2403    927,6804    2,015,920    12
                                                                          $
13   Transferred to finished goods in May                                              13
                                                                          2,072,220
14   Inventory in process, May 31                  46,3605     11,8566       58,216    14
15   Total costs assigned by the Cutting                                  $            15
      Department                                                                                               2,130,436
16 1$1,134,600 + $405,600 + $540,436                                                                                         16
17 21,250 units × $5.20                                                                                                      17
18 3178,400 units × $6.10                                                                                                    18
19 4178,400 units × $5.20                                                                                                    19
20 57,600 units × $6.10                                                                                                      20
21 62,280 units × $5.20                                                                                                      21


Ex. 20–18

a.       1. Work in Process—Casting Department ...........................                            441,000
              Materials—Alloy ..........................................................                                441,000
         2. Work in Process—Casting Department ...........................                            270,000
               Wages Payable ..............................................................                             108,000
               Factory Overhead .........................................................                               162,000*
            *$108,000 × 150%
         3. Work in Process—Machining Department ......................                               725,820*
              Work in Process—Casting Department .....................                                                  725,820
             *Supporting calculations:
             Cost of 9,200 transferred-out pounds:
             Inventory in process, October 1 ................................................................         $ 45,920
             Cost to complete October 1 inventory:
                280 pounds × $30/lb. (see calculations below) ....................................                          8,400
             Pounds started and completed in October
                [8,500 lbs. × ($49 + $30)] ......................................................................       671,500
             Transferred to Machining Department ....................................................                  $725,820

             Supporting equivalent unit and cost per equivalent unit calculations:
                                  A                                     B                   C             D
                                                                                           Equivalent Units
                                                                Whole Units              Materials    Conversion
       Inventory in process, October 1
     1                                                                  700                     —                   2801       1
       (60% completed)
     2 Started and completed in October                               8,500                 8,500                   8,500      2
       Transferred to Machining Department
     3 in                                                            9,200                  8,500                   8,780      3
       October
       Inventory in process, October 31
     4                                                                  500                    500                  2202       4
       (44% completed)
     5 Total                                                         9,700                  9,000                   9,000      5
     6 140% × 700                                                                                                              6
     7 244% × 500                                                                                                               7

                                                                    $441,000
             Cost per equivalent unit of materials:                          = $49 per pound
                                                                      9,000

                                                                      $270,000
             Cost per equivalent unit of conversion:                           = $30 per pound
                                                                        9,000
b.       $31,100; determined as follows:
            Direct materials (500 × $49) ..............................................             $ 24,500
            Conversion (500 × 44% × $30) ..........................................                    6,600
                                                                                                    $ 31,100
                                                            or
             $31,100 = $45,920 + $441,000 + $108,000 + $162,000 – $725,820



Ex. 20–19

a.       1. Work in Process—Papermaking Department .................                                  306,000
              Materials—Pulp............................................................                                 306,000
         2. Work in Process—Papermaking Department .................                                  161,000
              Wages Payable ..............................................................                               100,000
              Factory Overhead .........................................................                                  61,000
         3. Work in Process—Converting Department .....................                               441,700*
              Work in Process—Papermaking Department ...........                                                         441,700
             *Supporting calculations:
             Cost of 65,000 transferred-out units:
             Inventory in process, July 1 .......................................................................      $ 24,500
             Cost to complete July 1 inventory:
                4,000 units × $2.30/unit (see calculations below) ...............................                            9,200
             Units started and completed in July
                [60,000 units × ($4.50 + $2.30)] ............................................................            408,000
             Transferred to Converting Department ...................................................                   $441,700

             Supporting equivalent unit and cost per equivalent unit calculations:
                                 A                                      B                   C             D
                                                                                           Equivalent Units
                                                                 Whole Units             Materials    Conversion
       Inventory in process, July 1
     1                                                               5,000                    —                     4,0001      1
       (20% completed)
     2 Started and completed in July                                60,000                 60,000                   60,000      2
     3 Transferred to Converting                                    65,000                 60,000                   64,000      3
       Department
       in July
       Inventory in process, July 31
     4                                                        8,000                8,000           6,0002   4
       (75% completed)
     5 Total                                                 73,000              68,000            70,000   5
     6 180% × 5,000                                                                                         6
     7 275% × 8,000                                                                                         7


                                                        $306,000
       Cost per equivalent unit of materials:                    = $4.50 per unit
                                                         68,000

                                                               $161,000
           Cost per equivalent unit of conversion:                      = $2.30 per unit
                                                                70,000

b.     $49,800; determined as follows:
          Direct materials (8,000 × $4.50) ........................................     $ 36,000
          Conversion (8,000 × 75% × $2.30) ....................................           13,800
                                                                                        $ 49,800
                                                      or
           $49,800 = $24,500 + $306,000 + $100,000 + $61,000 – $441,700

				
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