Question

orts Hearty Soup Co. uses a process cost system to record the costs of processing soup, which requires the cooking and filling processes. Materials are entered from the cooking pro- cess at the beginning of the filling process. The inventory of Work in Process—Filling on April 1 and debits to the account during April were as follows:

Work in Process—Sifting Department (900 units, 3⁄5 completed): Direct materials (900 × $2.05) $1,845 Conversion (900 × 3⁄5 × $0.40) 216

$2,061

The following costs were charged to Work in Process—Sifting Department during July:

Direct materials transferred from Milling Department: 15,700 units at $2.15 a unit

Direct labor Factory overhead

$33,755 4,420 2,708

Bal., 800 units, 30% completed: Direct materials (800 × $4.30) Conversion (800 × 30% × $1.75)

From Cooking Department, 7,800 units Direct labor Factory overhead

$ 3,440 420

$ 3,860

$34,320 8,562 6,387

During April, 800 units in process on April 1 were completed, and of the 7,800 units entering the department, all were completed except 550 units that were 90% completed.

Charges to Work in Process—Filling for May were as follows:

From Cooking Department, 9,600 units Direct labor Factory overhead

$44,160 12,042 6,878

During May, the units in process at the beginning of the month were completed, and of the 9,600 units entering the department, all were completed except 300 units that were 35% completed.

Instructions

1. Enter the balance as of April 1 in a four-column account for Work in Process—Filling. Record the debits and credits in the account for April. Construct a cost of production report and present computations for determining (a) equivalent units of production for materials and conversion; (b) cost per equivalent unit; (c) cost of goods finished, differentiating between units started in the prior period and units started and finished in April; and (d) work in process inventory.

Answer 1

1) Part a
Work in Process-Filling
Date	Item	Debit	Credit	Balance Dr.	Balance Cr.
Apr. 1	Balance 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
30	Balance 550 units, 90% completed			$3,311
May. 31	Cooking Dept., 9,600 units at $4.60	$44,160		$47,471
31	Direct labor	$12,042		$59,513
31	Factory overhead	$6,878		$66,391
31	Finished goods		$64,801	$1,590
31	Balance 300 units, 35% completed			$1,590
The credits are determined from the supporting cost of production reports
part b
1)
HEARTY SOUP CO.
Cost of Production Report-Filling Department
For the Month Ended April 30
UNITS	Whole Units	Equivalent Units
Direct Materials		Direct Materials	Conversion
Units charged to production:
Inventory in process, April 1	800
Received from Cooking Department	7800
Total units accounted for by the Filling Department	8600
Units to be assigned costs:
Inventory in process, April 1 (30% completed)	800	0	560
Started and completed in April(7800-550)	7250	7250	7250
Transferred to finished goods in April	8050	7250	7810
Inventory in process, April 30 (90% completed)	550	550	495
Total units to be assigned costs	8600	7800	8305
COSTS	Costs
	Direct Materials	Conversion	Total
Cost per equivalent unit:
Total production costs for April in Filling Department	$34,320	$14,949
Total equivalent units	÷ 7790	÷ 8295
Cost per equivalent unit	$4.4	$1.8
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
Cost allocated to completed and
partially completed units:
Inventory in process, April 1 balance			$3,860
To complete inventory in process, April 1 (560 x $1.80)			$1,008
Cost of completed April 1 work in process			$4,868
Started and completed in April (7240 x $4.40),(7240 x $1.80)	$31,900	$13,050	$44,950
Transferred to finished goods in April			$49,818
Inventory in process, April 30 (550 x $4.40),(495 x $1.80)	$2,420	$891	$3,311
Total costs assigned by the Filling Department			$53,129