Question

Weighted Average Method, Journal Entries

Muskoge Company uses a process-costing system. The company manufactures a product that is processed in two departments: Molding and Assembly. In the Molding Department, direct materials are added at the beginning of the process; in the Assembly Department, additional direct materials are added at the end of the process. In both departments, conversion costs are incurred uniformly throughout the process. As work is completed, it is transferred out. The following table summarizes the production activity and costs for February:

		Molding		Assembly
Beginning inventories:
Physical units		10,000		8,000
Costs:
Transferred in		—		$45,300
Direct materials		$22,000		—
Conversion costs		$13,800		$20,450
Current production:
Units started		25,000		?
Units transferred out		30,000		35,000
Costs:
Transferred in		—		?
Direct materials		$56,750		$40,250
Conversion costs		$103,500		$140,150
Percentage of completion:
Beginning inventory		40%		50%
Ending inventory		80		50

Required:

1. Using the weighted average method, prepare the following for the Molding Department:

a. A physical flow schedule

Molding Department, Physical flow schedule:
Units to account for:
Total units to account for
Units accounted for:
Units completed and transferred out:
Total units accounted for

b. An equivalent units calculation

	Total equivalent units
Direct Materials
Conversion Costs

c. Calculation of unit costs. Round your intermediate computations and final answer to four decimal places.
$ per unit

d. Calculate the cost of ending work in process and cost of goods transferred out. Round your answers to the nearest dollar.
Cost of ending work in process: $
Cost of goods transferred out: $

e. A cost reconciliation. When required, round your answers to the nearest dollar.

Costs to account for:
Beginning work in process	$
Costs incurred
Total costs to account for	$

Costs accounted for:
Transferred out	$
Ending work in process
Total costs accounted for	$

2. Prepare journal entries that show the flow of manufacturing costs for the Molding Department. (a) Materials are added at the beginning of the process, (b) conversion costs are recorded, and (c) units are transferred to the Assembly Department. When required, round your answers to the nearest dollar.

a.
b.
c.

3. Repeat Requirements 1 and 2 for the Assembly Department.

a. A physical flow schedule:

Assembly Department, Physical flow schedule:
Units to account for:
Total units to account for
Units accounted for:
Units completed and transferred out:
Total units accounted for

b. An equivalent units calculation

	Total Equivalent Units
Direct Materials
Conversion Costs
Transferred In

c. Calculate the total unit costs. Round your intermediate computations and final answer to four decimal places.
$ per unit

d. Calculate the cost of ending work in process and cost of goods transferred out. Round your answers to the nearest dollar.
Cost of ending work in process: $
Cost of goods transferred out: $

e. A cost reconciliation. If required, round your answers to the nearest dollar.

Costs to account for:
Beginning work in process	$
Costs incurred
Total costs to account for	$

Costs accounted for:
Transferred out	$
Ending work in process
Total costs accounted for	$

Note: Cost reconciliation totals differ due to rounding error.

Prepare journal entries that show the flow of manufacturing costs for the Assembly Department. (a) Materials are added at the end of the process, (b) conversion costs are recorded, and (c) the units are transferred to Finished Goods.

a.
b.
c.

Answer 1

1. Using the weighted average method, prepare the following for the Molding Department:
a. A physical flow schedule
Molding Department, Physical flow schedule:
Units to account for:
Units, beginning work in process	10,000.00
Units started in February	25,000.00
Total units to account for	35,000.00
Units accounted for:
Units completed and transferred out:
Started and completed	20,000.00
From beginning work in process	10,000.00
Units, ending work in process	5,000.00
Total units accounted for	35,000.00
b. An equivalent units calculation
	Direct Materials	Conversion Costs
Units completed	30,000.00	30,000.00
Add: Equivalent units in ending work in process	5,000.00	4,000.00
Total equivalent units	35,000.00	34,000.00
c. Calculation of unit costs. Round your intermediate computations and final answer to four decimal places.
Costs charged to the department:
	Direct Materials	Conversion Costs	Total
Costs in beginning work in process	$   22,000.00	$   13,800.00	$   35,800.00
Costs added by department	$   56,750.00	$ 103,500.00	$ 160,250.00
Total costs	$   78,750.00	$ 117,300.00	$ 196,050.00
Total equivalent units	35,000.00	34,000.00
Unit cost =	$        2.2500	$        3.4500
Unit cost = Unit direct materials cost + Unit conversion costs = $2.2500 + $3.4500	$        5.7000
d. Calculate the cost of ending work in process and cost of goods transferred out. Round your answers to the nearest dollar.
Cost of goods transferred out (30,000 × $5.7000)	$ 171,000.00
Cost of ending work in process:
Direct materials (5,000 × $2.2500)	$   11,250.00
Conversion costs (4,000 × $3.4500)	$   13,800.00
Total costs in ending work in process	$   25,050.00
e. A cost reconciliation. When required, round your answers to the nearest dollar.
Costs to account for:
Beginning work in process	$   35,800.00
Costs incurred	$ 160,250.00
Total costs to account for	$	$ 196,050.00
Costs accounted for:
Transferred out	$ 171,000.00
Ending work in process	$   25,050.00
Total costs accounted for		$ 196,050.00

с D E Assembly 8000 45300 20450 ? 35000 ? 40250 140150 A B B 3 Molding 4 Beginning inventories: 5 Physical units 10000 6 Costs: 7 Transferred in 8 Direct materials 22000 9 Conversion costs 13800 10 Current production: mene 11 Units started 25000 12 Units transferred out 30000 13 Costs: 14 Transferred in . 15 Direct materials 56750 16 Conversion costs 103500 17 Percentage of completion: 18 Beginning inventory 0.4 19 Ending inventory 0.8 20 Required: 21 1. Using the weighted average method, prepare the following for the Molding D 22 a. A physical flow schedule 23 Molding Department, Physical flow schedule: 24 Units to account for: 25 Units, beginning work in process =B5 26 Units started in February =B11 27 Total units to account for =B25+B26 28 Units accounted for: : 29 Units completed and transferred out: 30 Started and completed =B26*B19 31 From beginning work in process =B25 32 Units, ending work in process =B26*(1-B19) 33 Total units accounted for =SUM(B30:832) 34 35 b. An equivalent units calculation 0.5 0.5 36 37 Units completed Direct Materials =B12 Conversion Costs =B12 38 Add: Equivalent units in ending work in process 39 Total equivalent units 40 =B32 =B37+B38 =B38°B19 =C37+C38

А B с D c. Calculation of unit costs. Round your intermediate computations and final 41 answer to four decimal places. 42 Costs charged to the department: 43 44 Costs in beginning work in process 45 Costs added by department 46 Total costs 47 Total equivalent units 48 Unit cost = Direct Materials =B8 =B15 =B44+B45 =B39 =B46/B47 Conversion Costs =B9 =B16 =C44+C45 =C39 =C46/C47 Total =B44+C44 =B45+C45 =B46+C46 Unit cost = Unit direct materials cost + Unit conversion costs = $2.2500+ 49 $3.4500 50 =B48+048 d. Calculate the cost of ending work in process and cost of goods transferred 51 out. Round your answers to the nearest dollar. 52 Cost of goods transferred out (30,000 * $5.7000) =B37*B49 53 Cost of ending work in process: 54 Direct materials (5,000 $2.2500) =B38 B48 55 Conversion costs (4,000 × $3.4500) =C48°C38 56 Total costs in ending work in process =B54+B55 57 58 e. A cost reconciliation. When required, round your answers to the nearest dollar 59 Costs to account for: 60 Beginning work in process =D44 61 Costs incurred =D45 62 Total costs to account for $ 63 Costs accounted for: 64 Transferred out =B52 65 Ending work in process =B56 66 Total costs accounted for =B60+B61 =B64+B65