Question

Scribners Corporation produces fine papers in three production departments—Pulping, Drying, and Finishing. In the Pulping Department, raw materials such as wood fiber and rag cotton are mechanically and chemically treated to separate their fibers. The result is a thick slurry of fibers. In the Drying Department, the wet fibers transferred from the Pulping Department are laid down on porous webs, pressed to remove excess liquid, and dried in ovens. In the Finishing Department, the dried paper is coated, cut, and spooled onto reels. The company uses the weighted-average method in its process costing system. Data for March for the Drying Department follow:

		Percent Completed
	Units	Pulping			Conversion
Work in process inventory, March 1	3,300	100	%		80	%
Work in process inventory, March 31	7,500	100	%		80	%
Pulping cost in work in process inventory, March 1				$	1,155
Conversion cost in work in process inventory, March 1				$	561
Units transferred to the next production department					157,800
Pulping cost added during March				$	60,006
Conversion cost added during March				$	33,837

No materials are added in the Drying Department. Pulping cost represents the costs of the wet fibers transferred in from the Pulping Department. Wet fiber is processed in the Drying Department in batches; each unit in the above table is a batch and one batch of wet fibers produces a set amount of dried paper that is passed on to the Finishing Department.

Required:

1. Compute the Drying Department's equivalent units of production for pulping and conversion in March..

	Pulping Conversion Equivalent units of production

2. Compute the Drying Department's cost per equivalent unit for pulping and conversion in March.

(Round your answers to 2 decimal places.)

	Pulping Conversion Cost per equivalent unit

3.

	3. Compute the Drying Department's cost of units transferred out to the Finishing Department for pulping, conversion, and in total in March. (Round your intermediate calculations to 2 decimal places.) Pulping Conversion Total Cost of units completed and transferred out

4. Compute the Drying Department's cost of ending work in process inventory for pulping, conversion, and in total for March. (Round your intermediate calculations to 2 decimal places.)

	Pulping Conversion Total Cost of ending work in process inventory

5. Prepare a cost reconciliation report for the Drying Department for March.

Prepare a cost reconciliation report for the Drying Department for March. (Round your intermediate calculations to 2 decimal places.)

	Drying Department Cost Reconciliation Costs to be accounted for: Total cost to be accounted for Costs accounted for as follows: Total cost accounted for

Answer 1

1)	Equivalent units of production
					units	%	pulping	%	CC
	Completed & transferred				157,800	100%	157,800	100%	157,800
	work in process inventory,March 31				7,500	100%	7,500	75%	5625
	Equivalent units of production						165,300		163,425
2)	cost per Equivalent units
						pulping	CC	total
	Beginning work in process					1,155	561	1,716
	cost added during the year					60,006	33,837	93,843
	total cost					61,161	34,398	95,559
	equivalent units					165,300	163,425
	cost per EUP					0.37	0.210482	0.580482
4)	Cost of ending work in proces
	pulping		7,500	*.37		2775
	Conversion		5625	*.21		1184
	Cost of ending work in proces							3959
3)	Cost of units transferred
	pulping		157,800	*.37		58386
	conversion		157,800	*.21		33214.04		91600
5)	CostReconcilation report
	cost to be accounted
	Beginning work in process					1,716
	cost added during the year					93,843
	cost to be accounted					95,559
	cost accounted for
	transferred cost					91,600
	ending wip cost					3959
	cost accounted for					95,559