CHAPTER 20 Process Cost Systems
Prob. 20-3A (Continued)
Direct
COSTS Materials Conversion Total
Costs per equivalent unit:
Inventory in process, July 1 $ 2,061
Costs incurred in July 40,883
Total costs accounted for by the
Sifting Department $42,944
Cost allocated to completed and
partially completed units:
Inventory in process, July 1 balance $ 2,061
To complete inventory in process,
Inventory in process, July 31 2,365 396 2,761
Total costs assigned by the Sifting
Department $42,944
1
$4,420 + $2,708
2
$33,755 + $4,420 + $2,708
3
360 units × $0.45
Costs
2
67
CHAPTER 20 Process Cost Systems
Prob. 20-3A (Concluded)
2. Work in Process—Sifting Department 33,755
Work in Process—Milling Department 33,755
Work in Process—Packaging Department 40,183
Work in Process—Sifting Department 40,183
4. The cost of production report may be used as the basis for allocating product costs
between Work in Process and Transferred-Out (or Finished) Goods. The report can
also be used to control costs by holding each department head responsible for the
units entering production and the costs incurred in the department. Any differences
in unit product costs from one month to another, such as those in part (3), can be
studied carefully and any significant differences investigated.
Prob. 20-4A
1. and 2.
Item Dr. Cr. Dr. Cr.
Apr. 1 Bal., 800 units, 30% completed 3,860
30 Cooking Dept., 7,800 units at $4.40 34,320 38,180
30 Direct labor 8,562 46,742
30 Factory overhead 6,387 53,129
30 Finished goods* 49,818 3,311
*
The credits are determined from the supporting cost of production reports.
Date
Balance
Work in Process—Filling
CHAPTER 20 Process Cost Systems
Prob. 20-4A (Continued)
1.
Direct
Whole Materials Conversion
UNITS Units (a) (a)
Units charged to production:
Units to be assigned costs:
Inventory in process, April 1
(30% completed) 800 0560
Started and completed in April 7,250 7,250 7,250
Hearty Soup Co.
Cost of Production Report—Filling Department
For the Month Ended April 30
Equivalent Units
1
2
CHAPTER 20 Process Cost Systems
Prob. 20-4A (Continued)
Direct
COSTS Materials Conversion Total
Costs assigned to production:
Inventory in process, April 1 $ 3,860
Costs incurred in April 49,269
Total costs accounted for by the
Filling Department $53,129
Started and completed in April (c) 31,900 13,050 44,950
Transferred to finished goods
in April (c) $49,818
Inventory in process, April 30 (d) 2,420 891 3,311
Total costs assigned by the Filling
Department $53,129
1
$8,562 + $6,387
2
$34,320 + $8,562 + $6,387
3
560 units × $1.80
Costs
2
4
5
67
CHAPTER 20 Process Cost Systems
Prob. 20-4A (Continued)
2.
Direct
Whole Materials Conversion
UNITS Units (a) (a)
Units charged to production:
Inventory in process, May 1 550
Received from Cooking Department 9,600
Total units accounted for by the
Filling Department 10,150
Units to be assigned costs:
Hearty Soup Co.
Cost of Production Report—Filling Department
For the Month Ended May 31
Equivalent Units
CHAPTER 20 Process Cost Systems
Prob. 20-4A (Concluded)
Direct
COSTS Materials Conversion Total
Costs assigned to production:
Inventory in process, May 1 $ 3,311
Costs incurred in May 63,080
Total costs accounted for by the
Filling Department $66,391
Cost of completed May 1 work in
process $ 3,421
Started and completed in May (c) 42,780 18,600 61,380
Transferred to finished goods in
May (c) $64,801
1
$12,042 + $6,878
2
$44,160 + $12,042 + $6,878
3
55 units × $2.00
3. The cost per equivalent unit for direct materials increased from $4.30 in March
to $4.40 in April to $4.60 in May. Similarly, the cost per equivalent unit for
Costs
2
4
5
CHAPTER 20 Process Cost Systems
Appendix Prob. 20-5A
Whole Equivalent Units
UNITS Units of Production
Units to account for during production:
Units to be assigned costs:
Transferred to Packing Department in
December 208,900 208,900
Inventory in process, December 31
COSTS Costs
Unit costs:
Total costs for December in Roasting Department $572,130
Total equivalent units 211,900
Cost per equivalent unit $ 2.70
Costs assigned to production:
Inventory in process, December 1 $ 21,000
Costs incurred in Decembe
r
551,130
Total costs accounted for by the Roasting Department $572,130
*
$246,800 + $135,700 + $168,630
Sunrise Coffee Company
Cost of Production Report—Roasting Department
For the Month Ended December 31
*
12
÷
CHAPTER 20 Process Cost Systems
Prob. 20-1B
1. a. Materials 149,800
Accounts Payable 149,800
b. Work in Process—Making Department 105,700
Work in Process—Packing Department 31,300
Factory Overhead—Making Department 4,980
Factory Overhead—Packing Department 1,530
Materials 143,510
d. Factory Overhead—Making Department 10,700
Factory Overhead—Packing Department 7,900
Accumulated Depreciation 18,600
e. Factory Overhead—Making Department 2,000
Factory Overhead—Packing Department 1,500
Prepaid Insurance 3,500
h. Finished Goods 263,400
Work in Process—Packing Department 263,400
i. Cost of Goods Sold 265,200
Finished Goods 265,200
CHAPTER 20 Process Cost Systems
Prob. 20-1B (Concluded)
2.
Work in Work in
Process— Process— Finished
Materials Making Dept. Packing Dept. Goods
Balance, July 1……
…
$ 5,100 $ 6,790 $ 7,350 $ 13,500
3.
Balance, July 1……
…
Debits………………
…
Credits………………
Balance, July 31…
…
Factory Overhead— Factory Overhead—
Making Dept. Packing Dept.
$ 510 $ (820)
$0 $0
33,080 29,230
(32,570) (30,050)
Dr. Cr.
12
21
…
…
CHAPTER 20 Process Cost Systems
Prob. 20-2B
1.
Whole Direct
UNITS Units Materials Conversion
Units charged to production:
Inventory in process, October 1 2,300
Units to be assigned costs:
Inventory in process, October 1
(3/5 completed) 2,300 0920
Started and completed in Octobe
r
23,400 23,400 23,400
Transferred to Molding Department in
October 25,700 23,400 24,320
Bavarian Chocolate Company
Cost of Production Report—Blending Department
For the Month Ended October 31
Equivalent Units
1
2
CHAPTER 20 Process Cost Systems
Prob. 20-2B (Continued)
Direct
COSTS Materials Conversion Total
Costs per equivalent unit:
Total costs for October in Blending
Costs assigned to production:
Inventory in process, October 1 $ 46,368
Costs incurred in Octobe
r
578,040
Total costs accounted for by the
Blending Department $624,408
Cost allocated to completed and
partially completed units:
Started and completed in Octobe
r
$386,100 140,400 526,500
Transferred to Molding Department
in October $578,388
Inventory in process, October 31 42,900 3,120 46,020
Total costs assigned by the Blending
Department $624,408
Costs transferred to Molding Department: $578,388
Work in process, October 31: 2,600 units at a cost of $46,020
1
$100,560 + $48,480
2
$429,000 + $100,560 + $48,480
Costs
2
4
5
67
CHAPTER 20 Process Cost Systems
Prob. 20-2B (Concluded)
2. Direct materials cost decreased $0.15, from $16.65 in September to $16.50 in October.
Conversion cost increased $0.15, from $5.85 in September to $6.00 in October.
Computations:
Direct materials: $16.65 ($38,295 ÷ 2,300 units)
Conversion: $5.85, determined as follows:
CHAPTER 20 Process Cost Systems
Prob. 20-3B
1.
Whole Direct
UNITS Units Materials Conversion
Units to be assigned costs:
Inventory in process, January 1
(60% completed) 3,400 01,360
Started and completed in January 49,600 49,600 49,600
Transferred to finished goods
Dover Chemical Company
Cost of Production Report—Filling Department
For the Month Ended January 31
Equivalent Units
1
2
CHAPTER 20 Process Cost Systems
Prob. 20-3B (Continued)
Direct
COSTS Materials Conversion Total
Costs per equivalent unit:
Inventory in process, January 1 $ 40,528
Costs incurred in January 693,576
Total costs accounted for by the
Filling Department $734,104
Started and completed in January 471,200 188,480 659,680
Transferred to finished goods in
January $705,376
Inventory in process, January 31 25,650 3,078 28,728
Total costs assigned by the Filling
Department $734,104
1
$101,560 + $95,166
2
$496,850 + $101,560 + $95,166
3
1,360 units × $3.80
4
49,600 units × $9.50
Costs
2
4
5
67