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:
October 1, Inventory:
30,000 units
100% complete for materials
($60,000) and 50% complete
for direct labor ($7,500) and
overhead ($15,000)
October 31, Inventory:
20,000 units
100% complete for materials
and 30% complete for
direct labor and overhead
Units started during Oct.:
40,000 units
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October production costs:
Direct materials
$110,100
Direct labor
28,900
Overhead
57,800
Materials are added at the beginning of the process. Direct labor and overhead are incurred evenly
throughout the process. Prepare the October process cost summary assuming the weighted average
method of inventory costing.
208) Kominski Company completed and transferred 90,000 units during the current period. Based on the
following information, determine the cost of the units completed during the current reporting period
and journalize the transfer.
Direct
Materials
Direct
Labor/OH
Costs of Beginning Work in Process:
$576,000
$400,000
Costs incurred this period
2,400,000
5,120,000
Equivalent units of production
96,000
92,000
209) Grayson Company had 8,700 units in beginning inventory with accumulated costs for direct
materials of $17,900, $16,500 direct labor, and $13,200 of overhead. During July, the company
completed and transferred 50,000 units to finished goods. Costs incurred in the current period
included $45,000 of direct materials, $58,500 of direct labor, and $46,800 of factory overhead.
Ending inventory consisted of 12,000 units which were 90% complete with respect to materials
and 50% complete with respect to labor and overhead. Compute the value assigned to ending
inventory based on the weighted average method of inventory costing.
210) During the year, LT Corp. introduced 132,000 units into production and 144,000 units were
completed and transferred to finished goods. At the end of the year, the company had 13,600 units
in process that were 80% complete. Determine how many units the company had in Work in
Process at the beginning of the year.
211) The following table of cost information is available for the Renaldo Company for the month of
November:
Goods in
Process
Inventory–
Mixing
Goods in
Process
Inventory–
Molding
Finished
Goods
Inventory
Beginning Inventory
$12,000
$15,000
$24,000
Costs incurred:
Direct materials
22,000
14,000
Direct labor
32,000
17,000
Overhead applied
47,000
24,500
Costs transferred out
(100,000)
(152,000)
Costs transferred in
100,000
152,000
Cost of goods sold
(149,000)
Ending inventory
13,000
18,500
27,000
Based on the table of cost information above, prepare the general journal entry required to record the:
a. Transfer of goods from the molding department to the finished goods inventory.
b. Cost of goods sold for November.
212) Prepare general journal entries to record the following production activities for Oaks Manufacturing.
a. Purchased $82,000 of raw materials on credit.
b. Used $63,500 of direct materials in production.
c. Used $12,800 of indirect materials.
213) Prepare journal entries to record the following production activities for Oaks Manufacturing.
a. Used $93,900 of direct labor in the production department.
b. Used $11,200 of indirect labor.
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214) Prepare journal entries to record the following production activities for Oaks Manufacturing.
a. Incurred overhead costs of $79,000 (paid in cash).
b. Applied overhead at 110% of direct labor costs which are $93,900.
c. Transferred completed products with a cost of $258,200 to finished goods inventory.
d. Sold $602,000 of product on credit. Cost is $271,000.
215) Port Manufacturing Company uses a process costing system. Materials are added at the beginning of
the process. Direct labor and overhead are added evenly throughout the process. The company uses
monthly reporting periods for its weighted-average process costing. The following are the operating
and cost data information for October.
The October 1 beginning Work in Process Inventory consisted of 20,000 units. The costs for this
inventory are $82,500 of direct materials, $24,400 of direct labor, and $48,800 of factory overhead.
Factory overhead is applied at 200% of direct labor cost.
In addition to the beginning inventory costs, the company issued the following costs into Work in
Process Inventory; direct materials, $240,000; direct labor, $68,000; factory overhead, $136,000.
During October, the company completed and transferred 60,000 units of its product to finished
goods. At the end of the month, the Work in Process inventory consisted of 15,000 units that were
40% complete with respect to direct labor and factory overhead and 100% complete with respect to
materials.
Prepare the company’s process cost summary for October using the weighted average method.
SHORT ANSWER QUESTIONS
216) Process operations, also called process manufacturing or process production, is the ________
production of similar products in a ________ flow of sequential steps.
217) An ________is the number of units that could have been started and completed given the costs
incurred during the period.
218) If a process has ________ or ________ inventory of partially completed production, equivalent
units must be calculated so that total costs incurred during the period are assigned to all units
worked on.
219) The second step in accounting for production activity in a period, after determining the physical
flow of units, is to compute ________.
220) The third step in accounting for production activity in a period, before assigning and reconciling
costs, is to compute the ________.
221) The fourth step in accounting for production activity in a period is to prepare a cost reconciliation,
which reconciles ________ with the ________.
222) Materials and labor costs that are clearly associated with a specific process or department are
known as _ . Those costs that are not clearly associated with a specific process or
department are called _ _.
223) A ________ contains features of both process and job order costing systems.
224) In a process costing system, direct materials used are debited to the ________ account, and indirect
materials used are debited to the ________ account.
225) In a manufacturing operation with two process departments (1 and 2), the flow of costs would
proceed from Work in Process, Department #1 to ________.
226) In a process costing accounting system, factory wages are debited to ________, when direct labor
is used. When indirect labor is used, the ________ account is debited. In both cases the ________
is credited.
227) In process costing, factory overhead incurred does not usually equal that applied, which yields
either ________ or ________ overhead.
228) A process cost summary involves computations and analysis at four sequential steps. These are (1)
________ (2) ________, (3) ________, and (4) ________.
229) On a process cost summary, the total costs to account for (the processing costs for the period plus
the Work in Process at the end of the period) should equal ________ (________ plus ________).
230) When the final production department completes goods, the cost of the completed goods are
transferred to ________.
231) When the completed goods are sold, the cost of the completed goods are transferred to ________.