Question

Coor Problem 2 Tronc Payson Company produces a product that passes through two departments, mixing and cooking. In the mixing department, all direct materials are added at the beginning of the process. All other manufacturing inputs are added uniformly. The following information pertains to the mixing department for April: 1. Beginning work in process (BWIP), April 1: 100,000 pounds, 40 percent complete with respect to conversion costs. The costs assigned to this work areas follows: Direct materials $20,000 Direct labor 10,000 Overhead 30,000 2. Ending work in process (EWIP), April 30: 50,000 pounds, 60 percent complete with respect to conversion costs. 3. Units completed and transferred out: 360,000 pounds. The following costs were added during the month: Direct materials $211,000 Direct labor 100,000 Overhead 270,000 4. All units are inspected at the 80 percent point of completion, and any spoiled units identified are discarded. During April, 10,000 pounds were spoiled. (Half of the spoiled units are considered normal spoilage.) and FIT Required: 1. Prepare the 5-step cost of production report using the Weighted Average methods. 2. Prepare all the required journal entries for the Mixing Department

Answer 1

As per policy, only one question is allowed to answer at a time, so answering here problem 2 :

Problem 2)
1)Cost of Production report of Mixing department on WAM for april:
Input units	Particulars	Physical units	Dir Materials	Conversion costs	total
100000	B WIP (on WAM)	100000	100000	100000
320000	Introdu & Compl.	260000	260000	260000
	Tranf. To Cooking	360000	360000	360000
	Normal Loss	5000
	Abnormal Loss	5000	5000	4000
	E WIP	50000	50000	30000
420000	Equivalent units	420000	415000	394000
	Total Costs:
	B WIP		20000	40000
	Added during month		211000	370000
	Total costs to account for		231000	410000	641000
	Cost per Eq. unit		0.5566	1.0406
	Cost of Transferred out		200386	374619	575005
	Cost of E WIP		27831	31218	59050
	Cost of Abn. Loss		2783	4162	6946
	total cost accounted for				641000
2) Journal Entries:
Date	Acc Titles	Debit $	Credit $
a	WIP- Mixing Deptt.	581000
	Direct Material		211000
	Direct Labor		100000
	Overhead		270000
	(inputs transferred to production)
b	WIP - Cooking Deptt	575005
	Abnormal Loss	6946
	WIP- Mixing Deptt.		581951
	(the semi-finished goods transferred to cooking & Abnormal loss recorded)
c	Income summary	6946
	Abnormal Loss		6946
	(abnormal loss transferred to Income summary)