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Hearty Soup Co. uses a process cost system to record the costs of processing soup, which...

Hearty Soup Co. uses a process cost system to record the costs of processing soup, which requires the cooking and filling processes. Materials are entered from the cooking process at the beginning of the filling process. The inventory of Work in Process-Filling on April 1 and debits to the account during April were as follows:

Bal., 700 units, 30% completed:
Direct materials (700 × $4.60) $3,220
Conversion (700 × 30% × $1.75) 368
$3,588
From Cooking Department, 7,400 units $34,780
Direct labor 8,512
Factory overhead 2,464

During April, 700 units in process on April 1 were completed, and of the 7,400 units entering the department, all were completed except 500 units that were 90% completed.

Charges to Work in Process-Filling for May were as follows:

From Cooking Department, 9,500 units $46,550
Direct labor 12,030
Factory overhead 2,834

During May, the units in process at the beginning of the month were completed, and of the 9,500 units entering the department, all were completed except 400 units that were 35% completed.

Required:
1.
(a) Enter the balance as of April 1 in a four-column account for Work in Process-Filling. Record the debits and credits in the account for April.
(b) Construct a cost of production report and present computations for determining
i. equivalent units of production for materials and conversion.
ii. cost per equivalent unit.*
iii. cost of goods finished, differentiating between units started in the prior period and units started and finished in April.*
iv. work in process inventory.*
*If an amount is zero, enter "0". Round your cost per unit answers to the nearest cent and final answers to the nearest dollar amount.
2.
(a) Provide the same information for May by recording the May transactions in the four-column work in process account.
(b) Construct a cost of production report and present the May computations (i through iv) listed in part 1(b).
3. Comment on the change in costs per equivalent unit for March through May for direct materials and conversion costs.

Work in Process-Filling

1

Date

Item

Debit

Credit

Balance Dr.

Balance Cr.

2

Apr. 1

Balance

3

30

Cooking Department

4

30

Direct labor

5

30

Factory overhead

6

30

Finished goods

7

30

Balance

8

May 31

Cooking Department

9

31

Direct labor

10

31

Factory overhead

11

31

Finished goods

12

31

Balance

HEARTY SOUP CO.
Cost of Production Report-Filling Department
For the Month Ended April 30
UNITS Whole Units Equivalent Units
Direct Materials Conversion
Units to account for during production:
Inventory in process, April 1
Received from Milling Department
Total units accounted for by the Filling Department
Units to be assigned costs:
Inventory in process, April 1 (30% completed)
Started and completed in April
Transferred to finished goods in April
Inventory in process, April 30 (90% completed)
Total units to be assigned costs
COSTS Costs
Direct Materials Conversion Total
Cost per equivalent unit:
Total production costs for April in Filling Department
Total equivalent units ÷ ÷
Cost per equivalent unit
Costs assigned to production:
Inventory in process, April 1
Costs incurred in April
Total costs accounted for by the Filling Department
Cost allocated to completed and
partially completed units:
Inventory in process, April 1 balance
To complete inventory in process, April 1
Cost of completed April 1 work in process
Started and completed in April
Transferred to finished goods in April
Inventory in process, April 30
Total costs assigned by the Filling Department
HEARTY SOUP CO.
Cost of Production Report-Filling Department
For the Month Ended May 31
UNITS Whole Units Equivalent Units
Direct Materials Conversion
Units charged to production:
Inventory in process, May 1
Received from Milling Department
Total units accounted for by the Filling Department
Units to be assigned costs:
Inventory in process, May 1 (90% completed)
Started and completed in May
Transferred to finished goods in May
Inventory in process, May 31 (35% completed)
Total units to be assigned costs
COSTS Costs
Direct Materials Conversion Total
Cost per equivalent unit:
Total costs for May in Filling Department
Total equivalent units ÷ ÷
Cost per equivalent unit
Costs assigned to production:
Inventory in process, May 1
Costs incurred in May
Total costs accounted for by the Filling Department
Costs allocated to completed and
partially completed units:
Inventory in process, May 1 balance
To complete inventory in process, May 1
Cost of completed May 1 work in process
Started and completed in May
Transferred to finished goods in May
Inventory in process, May 31
Total costs assigned by the Filling Department

Solutions

Expert Solution

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Hearty Soup
Workings
Goods finished in April Whole Units
Inventory in Process April 1         700.00
Add: Received from Cooking Department      7,400.00
Less: Inventory in Process April 30         500.00
Goods finished in April     7,600.00
Started and completed in April
Goods finished in April      7,600.00
Less: Opening work in process         700.00
Started and completed in April     6,900.00
Hearty Soup- Cost of Production Report
For April 30 Whole Units Equivalent Units
Units charged to production Materials Conversion
Inventory in Process April 1           700.00
Received from Cooking Dept.       7,400.00
Total units accounted for by the Filling Dept.       8,100.00
Units to be assigned costs:
Inventory in Process April 1           700.00                 -            490.00
Started and completed in April       6,900.00    6,900.00       6,900.00
Goods finished       7,600.00    6,900.00      7,390.00
Inventory in Process April 30           500.00        500.00          450.00
Total units to be assigned costs:       8,100.00    7,400.00      7,840.00
Costs per equivalent unit Materials Conversion Total
Total costs for the April in Filling Dept. 34,780.00    10,976.00    45,756.00
Total equivalent units    7,400.00       7,840.00
Costs per equivalent unit            4.70              1.40
Costs charged to production
Inventory in Process April 1       3,220.00
Costs incurred in April    45,756.00
Total costs accounted for by Filling Dept.    48,976.00
Costs allocated to completed and partially completed units
Inventory in Process April 1       3,220.00
To complete Inventory in Process April 1                 -            686.00          686.00
Started and completed in April 32,430.00       9,660.00    42,090.00
Transferred to Finished goods in April    45,996.00
Inventory in Process April 30    2,350.00          630.00       2,980.00
Total costs assigned by Filling Dept.    48,976.00
Four column Work in Process- Filling Department Balance
Date Item Post Ref. Debit $ Credit $ Debit $ Credit $
April 1. Bal., 700 units, 30% completed     3,220.00       3,220.00
April 30. Cooking Dept., 7,400 units at $ 4.70 34,780.00     38,000.00
April 30. Direct Labor     8,512.00     46,512.00
April 30. Factory Overhead     2,464.00     48,976.00
April 30. Finished Goods     45,996.00       2,980.00
April 30. Bal., 500 units, 90% completed       2,980.00
Workings
Goods finished in May Whole Units
Inventory in Process May 1         500.00
Add: Received from Cooking Department      9,500.00
Less: Inventory in Process May 31         400.00
Goods finished in May     9,600.00
Started and completed in May
Goods finished in May      9,600.00
Less: Opening work in process         500.00
Started and completed in May     9,100.00
For May 31 Whole Units Equivalent Units
Units charged to production Materials Conversion
Inventory in Process May 1           500.00
Received from Cooking Dept.       9,500.00
Total units accounted for by the Filling Dept.     10,000.00
Units to be assigned costs:
Inventory in Process May 1           500.00                 -              50.00
Started and completed in May       9,100.00    9,100.00       9,100.00
Goods finished       9,600.00    9,100.00      9,150.00
Inventory in Process May 31           400.00        400.00          140.00
Total units to be assigned costs:     10,000.00    9,500.00      9,290.00
Costs per equivalent unit Materials Conversion Total
Total costs for the May in Filling Dept. 46,550.00    14,864.00    61,414.00
Total equivalent units    9,500.00       9,290.00
Costs per equivalent unit            4.90              1.60
Costs charged to production

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