Question

Maria Am Corporation uses the weighted-average method in its process costing system. The Baking Department is one of the processing departments in its strudel manufacturing facility. In June in the Baking Department, the cost of beginning work in process inventory was $4,840, the cost of ending work in process inventory was $1,190, and the cost added to production was $25,750. Required: Prepare a cost reconciliation report for the Baking Department for June.

Answer 1

We are going to prepare a Reconciliation Report as per the procedures under Process Costing.

Baking Department

Cost Reconciliation

	$
Costs to be accounted for :
Cost of beginning work in progress (A)	4,840
Costs added during the period (B)	25,270
Total Costs to be accounted for = (A) + (B)	30,110
Costs accounted for as follows:
Cost in ending WIP inventory (i)	1,160
Cost of units completed and transferred out ( Refer Working Note ) (ii)	28,950
Total cost accounted for (i) + (ii)	30,110

Working Note :

Calculation of Cost of units completed and transferred out :

	$
Cost of beginning work in progress inventory	4,840
Add : Costs added to production during the period	25,270
Less: Cost of ending work in progress inventory	(1,160)
Cost of units completed and transferred out	$28,950