Question

Four Seasons Company makes show blowers. Materials are added at the beginning of the process and conversion costs are uniformly incurred. At the beginning of September, work in process is 40% complete and at the end of the month it is 60% complete. Other data for the month include: Beginning work-in-process inventory Units started Units placed in finished goods 1,600 units 2,000 units 3,200 units $200,000 $260,000 Conversion costs Cost of direct materials Beginning work-in-process costs: Materials Conversion $154,000 $ 82,080 Required: 1. Prepare a production report with supporting schedules using the weighted average method of process costing to calculate the per-unit cost for snow blowers, cost for units completed and cost for WIP at the end of the month. (16 points) 2. Prepare journal entries to record transferring of materials to processing and from processing to finished goods. (4 points)

Answer 1

1) Prepare a production report: Flow of production Direct Materials Conversion Beginning work in process inventory Started during period To account for Physical Units 1.600 2.000 3,600 Units completed Ending work in process inventory Unit Accounted for (Equivalent unit) 3.200 400 3.600 3,200 400 3.600 3,200 240 3,440 Costs Conversion Beginning work in process costs Costs added during period Total costs to account for (a) Equivalent units (b) Equivalent unit costs Direct Totals Materials $236,080 $154.000 $460.000 $260,000 $696,080 $414,000 3,600 $197 $115 $82,080 $200,000 $282,080 3,440 $82 Assignment of costs: Completed units Ending work in process costs Costs accounted for $630,400 $65.680 $696,080 $368,000 $46,000 $414.000 $262,400 $19,680 $282,080 Credit 2) Journal entries: Account Titles and Explanation Debit Work in process $260,000 Material Inventory (To record transferring to materials to processing) $260.000 Finished goods $630,400 Work in process (To record processing to finished goods) $630,400