121
195) Refer to the following information about the Finishing Department in the Davidson Factory
for the month of June. Davidson Factory uses the FIFO method of inventory costing.
Beginning Work in Process inventory:
Physical units…………………………………………… 5,000 units
% complete for materials………………………………. 70%
% complete for labor and overhead……………………. 25%
Materials cost from May……………………………….. $7,350
Labor and overhead cost from May……………………. $3,125
Product started and completed:
Physical units…………………………………………… 40,000 units
Ending Work in Process inventory:
Physical units……………………………………………. 4,000 units
% complete for materials………………………………. 40%
% complete for labor and overhead……………………. 10%
Manufacturing costs for June:
Materials………………………………………………… $96,975
Labor and overhead……………………………………… $79,470
Compute the total cost of all units that were completed and transferred to finished goods during
June. Compute the total cost of the ending Work in Process inventory.
124
196) Refer to the following information about the Finishing Department in the Davidson Factory
for the month of June. Davidson Factory uses the weighted-average method of inventory costing.
Beginning Work in Process inventory:
Physical units…………………………………………… 5,000 units
% complete for materials………………………………. 70%
% complete for labor and overhead……………………. 25%
Materials cost from May……………………………….. $7,350
Labor and overhead cost from May……………………. $3,125
Product started and completed:
Physical units…………………………………………… 40,000 units
Ending Work in Process inventory:
Physical units……………………………………………. 4,000 units
% complete for materials………………………………. 40%
% complete for labor and overhead……………………. 10%
Manufacturing costs for June:
Materials………………………………………………… $96,975
Labor and overhead……………………………………… $79,470
Compute the total cost of all units that were completed and transferred to finished goods during
June. Compute the total cost of the ending Work in Process inventory.
197) A company’s January 1 Work in Process inventory contained 30,000 units that were 25%
complete with respect to direct labor. The beginning inventory was completed this year and
another 120,000 units were started. Of those started, 80,000 were finished and the remaining
40,000 were 30% complete. Calculate the equivalent units of production for the year using the
FIFO method.
198) Prepare the required general journal entries to record the following transactions for the
Ringer Company.
a. Purchased $40,000 of raw materials on account.
b. Used $12,000 of direct materials in the production department.
c. Used $5,000 of indirect materials.
199) Prepare the required general journal entry to record the following transactions for the
O’Harra Company.
a. Used $78,000 of direct labor in the production department.
b. Used $17,000 of indirect labor.
200) Wang Company provides the following data for the current year:
Estimated Factory Overhead $7,800
Factory Overhead Incurred $11,400
Factory Overhead Applied ?
Estimated Direct Labor Cost $12,000
Direct Labor Cost Incurred $11,800
Required:
a. Calculate the predetermined overhead allocation rate based on direct labor.
b. Determine the amount of overhead applied to production.
c. Prepare the journal entry to apply factory overhead to Work in Process.
201) Refer to the following information about the Shaping Department of the Minnesota Factory
for the month of August. Minnesota Factory uses the FIFO method of inventory costing.
Equivalent
Units
Total
Cost
Beginning Work in Process:
Costs from prior month……………………
$ 7,000
Materials added……………………………
300
Labor and overhead added…………………
375
Started and completed goods:
Materials added……………………………
2,000
Labor and overhead added…………………
2,000
Ending Work in Process:
Materials added……………………………
320
Labor and overhead added…………………
360
The cost per equivalent unit of materials is $10.00, and the cost per equivalent unit of labor and
overhead is $22.00. Compute the cost that should be assigned to the beginning units that were
completed and transferred during August.
Beginning Work in Process:
202) Refer to the following information about the Shaping Department of the Minnesota Factory
for the month of August. Minnesota Factory uses the weighted average method of inventory
costing.
Equivalent
Units
Total
Cost
Beginning Work in Process:
Costs from prior month……………………
$ 7,000
Materials added……………………………
300
Labor and overhead added…………………
375
Started and completed goods:
Materials added……………………………
2,000
Labor and overhead added…………………
2,000
Ending Work in Process:
Materials added……………………………
320
Labor and overhead added…………………
360
The cost per equivalent unit of materials is $10.00, and the cost per equivalent unit of labor and
overhead is $22.00. Compute the cost that should be assigned to the units that were started and
completed during August.
Started and completed goods:
203) Refer to the following information about the Shaping Department of the Minnesota Factory
for the month of August. Minnesota Factory uses the FIFO method of inventory costing. The
cost per equivalent unit of materials is $10.00, and the cost per equivalent unit of labor and
overhead is $22.00. Compute the cost that should be assigned all units that were completed and
transferred during August.
Equivalent
Units
Total
Cost
Beginning Work in Process:
Costs from prior month……………………
$ 7,000
Materials added……………………………
300
Labor and overhead added…………………
375
Started and completed goods:
Materials added……………………………
2,000
Labor and overhead added…………………
2,000
Ending Work in Process:
Materials added……………………………
320
Labor and overhead added…………………
360
Beginning Work in Process:
Costs from prior month…………
Materials costs added……………
Labor and overhead cost added…
Total………………………………
Started and completed goods:
Materials costs added……………
Labor and overhead cost added…
Total………………………………
204) Refer to the following information about the Shaping Department of the Minnesota Factory
for the month of August. Minnesota Factory uses the FIFO method of inventory costing.
Equivalent
Units
Total
Cost
Beginning Work in Process:
Costs from prior month……………………
$ 7,000
Materials added……………………………
300
Labor and overhead added…………………
375
Started and completed goods:
Materials added……………………………
2,000
Labor and overhead added…………………
2,000
Ending Work in Process:
Materials added……………………………
320
Labor and overhead added…………………
360
The cost per equivalent unit of materials is $10.00, and the cost per equivalent unit of labor and
overhead is $22.00. Compute the cost that should be assigned to the ending Work in Process
inventory for August.
$10.00
$22.00
7,920
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205) Refer to the following information about the Shaping Department of the Minnesota Factory
for the month of August. Minnesota Factory uses the FIFO method of inventory costing.
Equivalent
Units
Total
Cost
Beginning Work in Process:
Costs from prior month……………………
$ 7,000
Materials added……………………………
300
Labor and overhead added…………………
375
Started and completed goods:
Materials added……………………………
2,000
Labor and overhead added…………………
2,000
Ending Work in Process:
Materials added……………………………
320
Labor and overhead added…………………
360
The cost per equivalent unit of materials is $10.00, and the cost per equivalent unit of labor and
overhead is $22.00.Prepare a cost reconciliation for the month of August.
206) Giga Company uses a weighted average process cost system. The department started and
finished 129,000 units during the current period. The ending inventory consists of 60,000 units
that are 75% complete with respect to direct labor and overhead. All direct materials are added at
the beginning of the process. The department incurred direct labor costs of $262,500 and
overhead costs of $126,000.
(a) Compute the equivalent cost per unit for direct labor.
(b) Compute the equivalent cost per unit for overhead.
207) Bagger, Inc. uses a process costing system. The following operating and cost data occurred
during October: