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Process Costing Sweetooth manufactures cakes in two departments, Mixing and Baking, using a process cost system....

Process Costing

Sweetooth manufactures cakes in two departments, Mixing and Baking, using a process cost system. Data for each department for 20X3 are as follows:

                                                                                                            Mixing                                                                                                            Baking

Units:    Work-in-process 1/1/X3                                         3,000                                                                                              6,000

              Started in process                                                   49,000                    ?

              Completed and transferred                                    45,000              40,000

              Work-in-process 12/31/X3                                    5,000              10,000

Costs:    Work-in-process 1/1/X3

                      Transferred-in                                             $     n/a                $                      9,195

                      Materials                                                        11,710                         -0-

                      Conversion                                                     2,926                      2,524

              Added to department

                      Transferred-in                                                   n/a                           ?

                      Materials                                                        29,890                      70,000

                      Conversion                                                     45,374                      75,190

Other:    Materials added (% conversion)                               0%              75%

              Conversion complete

                      Beginning work-in-process                                2/3                      25%

                      Ending work-in-process                                     50%                      60%

              Inspection (% conversion)                                      100%              100%

              Normal spoilage (% of units started)                        3%              2%

The ingredients (flour, mild, eggs, etc.) are added at the beginning of the production process in the Mixing Department (i.e., 0% conversion). The cakes are baked in the Baking Department, after which the icing is applied (i.e., at 75% conversion).

Requirements:

Use Microsoft Excel to prepare a cost of production report template for each department to be used for any data for any accounting period:

  1. Enter the data above at the top of a spreadsheet exactly as it appears.
  2. Prepare a cost of production report for each department.
    1. Use the format presented in the snapshot of the solution. You will need to modify the format to account for potential normal and abnormal spoilage.
    2. Use IF statements to make it possible to present the information under weighted average or FIFO for both departments.
    3. Report your answers using the weighted average method for the Mixing Department and the FIFO method for the Baking Department

Solutions

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