Question

Minot Processing Company manufactures one product on a continuous basis in two departments, Processing and Finishing. All materials are added at the beg of work on the product in the Processing Department. During December 2009, the following events occurred in the Processing Department: Units started 16,000 units Units completed and transferred to Finishing Department 15,000 units Costs assigned to processing:Raw materials (one unit of raw materialsfor each unit of product started) $142,900 Manufacturing supplies used 18,000 Direct labor costs incurred 51,000 12,000 Supervisors' salaries Other production labor costs 14,000 6,000 Depreciation on equipment Other production costs 18,000 Additional information follows: Minot uses weighted average costing and applies manufacturing overhead to Work-in-Process at the rate of 100 percent of direct labor cost. Ending inventory in the Processing Department consists of 3,000 units that are one-third converted. Beginning inventory contained 2,000 units, one-half converted, with a cost of $34,500 ($24,500 for materials and $10,000 for conversion). (a) Prepare a cost of production report for the Processing Department for December. Do not use negative signs with any of your answers.

Answer 1

A C D E Minot Processing Company: Processing Department Cost of Production Report 1 2 For the Month Ending December 31, 2009 4 Summary of units in process: 5 Beginning 2000 6 Units started 16000 7 In process 18000 8 Completed 9 Ending 10 Equivalent units in process: 11 Units completed 15000 3000 Materials Conversion Total 15000 15000 3000 1000 12 Plus equivalent units in ending inventory 13 Equivalent units in process 18000 16000 Total cost to be accounted for and cost per 14 equivalent unit in process: 15 Beginning work-in-process 10,000 34,500 $ 24,500 $ $142,900 102,000 $244,900 $167,400 $ 112,000 $279,400 16 Current costs 17 Total cost in process 18 Equivalent units in process 19 Cost per equivalent unit in process 20 Accounting for total costs: 18000 16000 7.00 16.30 9.30 S $244,500 21 Transferred out 22 Ending work-in-process: 23 Materials 24 Conversion $ 27,900 7,000 $34,900 $279,400 $ 25 Total cost accounted for

A B C 28 Work-in-process: 29 Beginning $34,500 30 Current manufacturing costs: $142,900 31 Direct materials 32 Direct labor 33 Applied overhead 34 Total 35 Cost of goods manufactured 36 Ending $ 51,000 $ 51,000 $244,900 $279,400 $244,500 $34,900

C D E Minot Processing Company: Processing Department Cost of Production Report 1 2 For the Month Ending December 31, 2009 4 Summary of units in process: 5 Beginning 2000 16000 6 Units started 7 In process +B5+B6 15000 8 Completed 9 Ending 10 Equivalent units in process: 11 Units completed 12 Plus equivalent units in ending inventory 3000 Materials Total Conversion +B8*100% +B8*100% +B9*100% B9*1/3 =+D11+D12 13 Equivalent units in process +C11+C12 Total cost to be accounted for and cost per 14 equivalent unit in process: 15 Beginning work- in-process 16 Current costs 17 Total cost in process 18 Equivalent units in process 24500 +C15+D15 10000 -51000+(51000*100%) C16+D16 142900 +E15+E16 =+C15+C16 =+D15+D16 +C13 +D13 ЕC17/с18 +D17/D18 19 Cost per equivalent unit in process +C19+D19 20 Accounting for total costs: = 15000* E19 21 Transferred out 22 Ending work-in-process: 23 Materials +C12*C19 +D12*D19 +D23+D24 +E21+ E24 24 Conversion 25 Total cost accounted for

A B C 28 Work-in-process: 29 Beginning 30 Current manufacturing costs: 34500 31 Direct materials 142900 32 Direct labor 51000 33 Applied overhead +B32* 100 %+B31+ B32+B33 +C29+C33 +E21 34 Total 35 Cost of goods manufactured 36 Ending +C34-C35