Question

ABC Brushes Inc. manufactures electric toothbrushes. The brushes are manufactured in 2 sequential processes: Interior and Assembly. The electronics are manufactured in-house in the Interior Department and the casing and bristles are purchased from an outside manufacturer and are added in the Assembly Department. Information related the Interior Department for the month of October can be summarized as follows: Interior Department: Beginning Units: 2,600 – 70% completed Ending Units: 2,000 – 30% completed • New Units started this month: 6,000 • Direct Materials costs in beginning WIP: $310 • Conversion costs in beginning WIP: $705 • Direct Materials costs incurred this month: $2,098 • Conversion costs incurred this month: $4,047 • In the Interior Department, direct materials are added at the beginning of the process while conversion costs are added uniformly throughout the assembly process. ABC Brushes Inc. is preparing for a year-end audit of its financial statements, and wants to make sure that it reports the results of production and its inventories fairly. Assuming ABC Brushes uses the weighted average method for process costing, what are the Cost of Goods Manufactured (Completed and Transferred) and ending Work in Process Inventory balance in the Interior Department for October? (Round per unit costs to the nearest cent)

Answer 1

2-- х Process Costing - Microsoft Excel (Product Activation Failed) File Home Insert Formulas Data Review View ♡ Page Layout foc F14 A B E F H 1 2 с D ABC BRUSHES INC., FOR INTERIOR DEPARTMENT PRODUCTION COST REPORT FOR THE MONTH ENDED OCTOBER 31 3 4 5 6 7 $ $ $ $ $ $ 1,015.00 6,145.00 7,160.00 7,160.00 9 10 11 12 Beginning Inventory Cost incurred in Current Period Total Costs to account for Total Costs accounted for *Difference due to rounding cost/unit Units Reconciliation Units to account for Beginning Work in Process Units started this period This units to account for Total units accounted for Completed and transferred out (Bal Fig) Ending Work in Process Total units accounted for 13 14 2,600 6,000 8,600 15 16 17 18 6,600 2,000 8,600 19 20 21 Equivalent Units of Production (EUP) 22 Units % MATERIALS EUP - MATERIALS % CONVERSION EUP - CONVERSION 23 24 Units Accounted For Transferred Out Ending Work in Process Total Units Accounted for 25 6,600 2,000 8,600 100% 100% 100% 6,600.00 2,000.00 8,600.00 100% 30% 100% 6,600.00 600.00 7,200.00 26 27 28 29 KI Sheet22 Sheet23 Sheet24 Sheet25 Sheet26 Sheet27 Sheet28 Sheet29 Sheet30 Sheet31 Ready BO! 100% 7:21 AM 17-Sep-20

х XI - 95 Process Costing - Microsoft Excel (Product Activation Failed) File Home Insert Formulas Data Review View ♡ Page Layout foc H43 А B с D E F G H 1 30 31 32 33 COSTS PER EUP MATERIALS CONVERSION COSTS 34 35 36 37 Cost of Beginning Work in Process Cost incurred in Current Year Total Costs / Equivalent Units Costs per Equivalent Unit of Production $ 310.00 2,098.00 2,408.00 8,600.00 0.28 Costs EUP $ Costs EUP 705.00 4,047.00 4,752.00 7,200.00 0.66 38 39 $ 40 41 TOTAL COSTS ACCOUNTED FOR : 42 43 O 44 Transferred Out Materials Conversion Costs EUP Cost per EUP 6,600.00 $ 0.28 6,600.00 $ 0.66 $ $ Total Cost 1,848.00 4,356.00 45 46 Total Cost transferred out $ 6,204.00 47 48 49 Ending Work in Process Materials Conversion Costs Total Costs of ending Work in Process 2,000.00 $ 600.00 $ 0.28 0.66 560.00 396.00 50 $ 51 $ 956.00 52 53 Total Costs accounted for $ 7,160.00 54 55 56 57 58 Sheet22 Sheet23 Sheet24 Sheet25 Sheet26 Sheet27 Sheet28 Sheet29 Sheet30 Sheet31 Ready BO! 100% - 7:22 AM 17-Sep-20

Formula Sheet :

х 9- Process Costing - Microsoft Excel (Product Activation Failed) File Home Insert Page Layout Formulas Data Review View H5 A A B E F G H 1 1 2 с D ABC BRUSHES INC., FOR INTERIOR DEPARTMENT PRODUCTION COST REPORT FOR THE MONTH ENDED OCTOBER 31 3 4 5 6 7 8 =310+705 = 2098+4047 =SUM(C6:07) =+F53 =+C8-C9 9 10 11 12 Beginning Inventory Cost incurred in Current Period Total Costs to account for Total Costs accounted for *Difference due to rounding cost/unit Units Reconciliation Units to account for Beginning Work in Process Units started this period This units to account for Total units accounted for Completed and transferred out (Bal Fig) Ending Work in Process Total units accounted for 13 14 2600 6000 =SUM(C13:C14) 15 16 17 18 =+C19-C18 2000 +C15 19 20 21 22 EUP - CONVERSION 23 Equivalent Units of Production (EUP) Units % MATERIALS EUP - MATERIALS % CONVERSION Units Accounted For Transferred Out =+C17 1 =+C24*D24 1 Ending Work in Process =+C18 1 =+C25*D25 0.3 Total Units Accounted for =SUM(C24:C25) 1 =SUM(E24:E25) 1 24 25 =+C24F24 =+C25*F25 =SUM(G24:G25) 26 27 28 29 Sheet22 Sheet23 Sheet24 Sheet25 Sheet26 Sheet27 Sheet28 Sheet29 Sheet30 Sheet31 Ready BO" 100% - 7:27 AM 17-Sep-20

х X- Process Costing - Microsoft Excel (Product Activation Failed) File Home Insert Formulas Data Review View Page Layout foc H34 A A B с D E F G H 1 30 31 MATERIALS CONVERSION COSTS Costs EUP 310 2098 =SUM(E35:E36) =+E26 =+E37/E38 Costs EUP 705 4047 =SUM(G35:636) =+G26 =+G37/G38 32 33 COSTS PER EUP 34 35 Cost of Beginning Work in Process 36 Cost incurred in Current Year 37 Total Costs 38 / Equivalent Units 39 Costs per Equivalent Unit of Production 40 41 TOTAL COSTS ACCOUNTED FOR: 42 43 Transferred Out EUP 44 Materials =+E24 45 Conversion Costs =+G24 46 Total Cost transferred out 47 48 Ending Work in Process 49 Materials =+E25 50 Conversion Costs =+G25 51 Total Costs of ending Work in Process 52 53 Total Costs accounted for 54 55 Cost per EUP =+E39 =+G39 Total Cost =++C44*D44 =+C45*D45 =SUM(E44:E45) E =+E39 =+G39 =+C49*D49 =+C50*050 =SUM(E49: E50) =+F46+F51 56 57 58 Sheet22 Sheet23 Sheet24 Sheet25 Sheet26 Sheet27 Sheet28 Sheet29 Sheet30 Sheet31 Ready BO" 100% - 7:27 AM 17-Sep-20

For any queries please comment

If you are satisfied with the solution, please click the LIKE THUMB