Question

Company manufactures car seats in its Hartford plant. Each car seat passes through the assembly department and testing department. This problem focuses on the testing department. Direct materials are added when the testing department process is 95​% complete. Conversion costs are added evenly during the testing​ department's process. As work in assembly is​ completed, each unit is immediately transferred to testing. As each unit is completed in​ testing, it is immediately transferred to Finished Goods. St. Germaine Company uses the​ weighted-average method of process costing. Data for the testing department for October 2017 are as​ follows:

	Physical Units	Transferred-In	Direct	Conversion
	(Car Seats)	Costs	Materials	Costs

Work in​ process, October 1a	7,000	$2,937,000	$0	$749,870
Transferred in during October 2017	​?
Completed during October 2017	29,800
Work in​ process, October 31b	3,200
Total costs added during October 2017		$8,877,000	$11,055,800	$4,420,490

aDegree of​ completion: transferred-in​ costs, ?%; direct​ materials, ?%; conversion​ costs,75​%.

bDegree of​ completion: transferred-in​ costs, ?%; direct​ materials, ?%; conversion​ costs, 60​%.

1.	What is the percentage of completion for​ (a) transferred-in costs and direct materials in beginning​ work-in-process inventory and​ (b) transferred-in costs and direct materials in ending​ work-in-process inventory?
2.	For each cost​ category, compute equivalent units in the testing department. Show physical units in the first column of your schedule.
3.	For each cost​ category, summarize total testing department costs for October 2017​,calculate the cost per equivalent​ unit, and assign costs to units completed​ (and transferred​ out) and to units in ending work in process.
4.	Prepare journal entries for October transfers from the assembly department to the testing department and from the testing department to Finished Goods.

Answer 1

1.

	Transferred in	Direct Material
Beginning Work in Process	100%	0%
Ending Work in Process	100%	0%

2. & 3.

	Physical units	Transferred in	Material	Conversion
Units to account for
Work in Process Beginning	7000
Units transferred from framing department	26000
Total units to account for	33000
Units Accounted for
Completed and transferred	29800	29800	29800	29800
Work in Process Ending	3200	3200	0	1920
Total Units Accounted for	33000
Equivalent units		33000	29800	31720
	Transferred In	Direct Material	Conversion Costs	Total
Cost of Beginning Work in Process	$     2,937,000	$                   -	$      749,870	$      3,686,870
Cost added during the period	$     8,877,000	$ 11,055,800	$ 4,420,490	$    24,353,290
Total Cost to account for	$ 11,814,000	$ 11,055,800	$ 5,170,360	$   28,040,160
Equivalent units of Production	33000	29800	31720
Cost per equivalent unit	$          358.00	$          371.00	$        163.00	$           892.00
	Transferred in	Material	Conversion	Total
Units Completed and transferred out
Units transferred to next department	29800	29800	29800
Cost per equivalent unit	$          358.00	$          371.00	$        163.00
Cost of units transferred out	$ 10,668,400	$ 11,055,800	$ 4,857,400	$   26,581,600
	Transferred in	Material	Conversion	Total
Ending work in Process Inventory
Equivalent units of Production	3200	0	1920
Cost per equivalent unit	$          358.00	$          371.00	$        163.00
Cost of Ending work in Process Inventory	$    1,145,600	$                   -	$     312,960	$     1,458,560
Total Costs Accounted for	$ 11,814,000	$ 11,055,800	$ 5,170,360	$   28,040,160

4.

Account Titles	Debit	Credit
Work in Process - Testing	$     8,877,000
Work in Process - Assembly		$     8,877,000
Finished Goods Inventory	$   26,581,600
Work in Process - Testing		$ 26,581,600