Question

Seacrest Company uses a process-costing system. The Company manufactures one product in a single production facility and employees the weighted average method to assign costs. As work is completed goods are transferred to finished goods. The following summarizes the production activity for November 2019: Physical units in Inventory October 31, 2019..............5,000 Costs of October 31, 2019 Inventory Direct materials $10,000 Conversion Costs $ 6,900 November Production Units started Units transferred 25,000 28.000 November Costs Direct materials Conversion Costs $57,784 $95,340 Percentage Completion Inventory 10/31/19 Materials Conversion Costs 90% 80% Inventory 11/30/19 Materials Conversion Costs 80% 40% Required: 1. Prepare a Cost Reconciliation Report for November 2019. 2. What is the total equivalent units of production for November 2019? 3. What is the cost per equivalent unit for November 2019? 4. What is the costs transferred to finished goods for November 2019 and the costs assigned to ending work-in-process at November 30, 2019? 5. Prepare the journal entry to record the costs transferred from work-in-process to finished goods.

Answer 1

Answer 1 .	Cost reconciliation report
	Total Costs to Account for:
	Costs of opening work in process			16900
	Costs incurred this period
	Material			57784
	Conversion			95340
	Total costs to account for:			170024
	Total costs accounted for			170024
	Difference due to rounding cost/unit			0
	Cost Assignment and Reconciliation
	Cost of units transferred out	EUP	Cost per EUP	Total cost
	Direct materials	28000	2.29	64120
	Conversion	28000	3.55	99400
	Total costs transferred out			163520
	Costs of ending work in process	EUP	Cost per EUP	Total cost
	Direct materials	1600	2.29	3664
	Conversion	800	3.55	2840
	Total cost of ending work in process			6504
	Total costs accounted for			170024
Answer 2	Equivalent Units
			Material	Conversion
	Equivalent Units		29600	28800
Answer 3	Cost per equivalent Units
			Material	Conversion
	Cost per equivalent Units		$              2.29	$            3.55
Answer 4			Material	Conversion	Total
	Cost of ending work in process inventory		$         30,154	$         4,829	$        34,982
	Cost of units transferred out		$       307,120	$     110,660	$      417,780

Answer 5.	Date	Account title and Explanation	DR	CR
		Finished Goods Account	$ 163,520
		Work in Process		$       163,520
	(Cost of finished work transferred)

Detailed workings

Equivalent Units of Production (EUP)- Weighted Average Method
	Units	% Materials	EUP—Materials	% Conversion	EUP—Conversion
Units completed and transferred out	28000	100%	28000	100%	28000
Units of ending work in process	2000	80%	1600	40%	800
Equivalent units of production			29600		28800
Cost per Equivalent Unit of Production			Materials		Conversion
Beginning WIP			$     10,000		$           6,900
Added in November			$     57,784		$         95,340
Total costs		Costs	67784	Costs	102240
÷ Equivalent units of production		EUP	29600	EUP	28800
Cost per equivalent unit of production (rounded to 2 decimals)			$        2.29		$             3.55
Total Costs to Account for:
Costs of begininning work in process		$      16,900
Costs incurred this period
Material		$      57,784
Conversion		$      95,340
Total costs to account for:		$    170,024
Total costs accounted for		$    170,024
Difference due to rounding cost/unit		$             -
Cost Assignment and Reconciliation
Cost of units transferred out	EUP	Cost per EUP	Total cost
Direct materials	28000	$          2.29	$     64,120
Conversion	28000	$          3.55	$     99,400
Total costs transferred out			$   163,520
Costs of ending work in process	EUP	Cost per EUP	Total cost
Direct materials	1600	$          2.29	$      3,664
Conversion	800	$          3.55	$      2,840
Total cost of ending work in process			$      6,504
Total costs accounted for			$   170,024