Question

Fast Co. produces its product through a single processing department. Direct materials are added at the start of production, and conversion costs are added evenly throughout the process. The company uses monthly reporting periods for its weighted-average process costing system. The Work in Process Inventory account has a balance of $86,300 as of October 1, which consists of $17,700 of direct materials and $68,600 of conversion costs. During the month the company incurred the following costs: Direct materials Conversion $146,650 842,920 During October, the company started 142,000 units and transferred 152,000 units to finished goods. At the end of the month, the work in process inventory consisted of 21,000 units that were 80% complete with respect to conversion costs Required: 1. Prepare the company's process cost summary for October using the weighted-average method. 2. Prepare the journal entry dated October 31 to transfer the cost of the completed units to finished goods inventory

Answer 1

total costs to account for:
Beginning work in process				86,300
cost added during the year				989570
total costs to account for:				1,075,870
total costs accounted for				1,075,870
Difference due to rounding				0
Unit reconciliation:
units to account for:
Beginning work in process				31,000
started during the year				142,000
total units to account for				173,000
Total units accounted for
transferred to finished goods				152,000
ending work in process inventor				21,000
total units accounted for				173,000
Equivalent units of production-(EUP)-weighted average method
				units	%	EUP-	%	EUP
					materials	materials	converstion	CC
transferred to finished goods				152,000	100%	152,000	100%	152,000
ending work in process inventory				21,000	100%	21,000	80%	16800
total units						173,000		168,800
Cost per Equivalent units of production						Materials		Conversion
Beginning work in process						17,700		68,600
cost added during the year						146,650		842,920
total costs					costs	164,350	costs	911,520
equivalent units of production					EUP	173,000	EUP	168,800
Cost per Equivalent units of production						0.95		5.40
total costs accounted for
cost of units transferred out:				EUP	cost EUP	total
direct materials				152,000	0.95	144400
conversion				152,000	5.40	820800
total costs transferred out						965200
cost of ending work in process				EUP	cost EUP	total
direct materials				21,000	0.95	19950
conversion				16,800	5.40	90720
total cost of ending work in process						110670
total costs accounted for							1075870
Req 2
	General Journal				Debit	Credit
	finished goods inventory				965200
	work in process inventory					965200