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Salanger Manufacturing Corporation produces a dandruff shampoo in three consecutive processes. The costs of Department 1...

Salanger Manufacturing Corporation produces a dandruff shampoo in three consecutive processes. The costs of Department 1 for June 2019 were as follows:

Cost of beginning inventory
Direct material $5,500
Conversion costs 12,740
Costs added in Department 1:
Direct material $223,390
Direct labor 358,300
Manufacturing overhead 155,269 736,959

Department 1 handled the following units during June:

Units in process, June 1 2,000
Units started in Department 1 45,000
Units transferred to Department 2 46,000
Units in process, June 30 1,000

On average, the June 1 units were 40% complete; the June 30 units were 70% complete. Direct materials are added at the beginning of the process, and conversion costs occur evenly throughout the process in Department 1. Gomez uses the weighted average method for process costing.

Required

Prepare the product cost report for Department 1 for June.

Round average cost per equivalent unit to two decimal places. Use rounded answers for subsequent calculations. Round other answers to the nearest whole number.

Salanger Manufacturing Corporation produces a dandruff shampoo in three consecutive processes. The costs of Department 1 for June 2019 were as follows:

Cost of beginning inventory
Direct material $5,500
Conversion costs 12,740
Costs added in Department 1:
Direct material $223,390
Direct labor 358,300
Manufacturing overhead 155,269 736,959

Department 1 handled the following units during June:

Units in process, June 1 2,000
Units started in Department 1 45,000
Units transferred to Department 2 46,000
Units in process, June 30 1,000

On average, the June 1 units were 40% complete; the June 30 units were 70% complete. Direct materials are added at the beginning of the process, and conversion costs occur evenly throughout the process in Department 1. Gomez uses the weighted average method for process costing.

Required

Prepare the product cost report for Department 1 for June.

Round average cost per equivalent unit to two decimal places. Use rounded answers for subsequent calculations. Round other answers to the nearest whole number.

Solutions

Expert Solution

Solution:

Computatio of Equivalent units - Weighted Average - Department 1
Particulars Physical Units Equivalent units
Material Conversion
Work in Process, beginning 2000
Started during the current period 45000
Total units to account for 47000
Units accounted for:
Unit completed & Transferred out 46000 46000 46000
Closing WIP: 1000
Material (100%) 1000
Conversion (70%) 700
Equivalent units of production 47000 47000 46700
Computation of Cost per equivalent unit of Production - Department 1
Particulars Material Conversion
Opening WIP $5,500.00 $12,740.00
Cost Added during Period $223,390.00 $513,569.00
Total cost to be accounted for $228,890.00 $526,309.00
Equivalent units of production 47000 46700
Cost per Equivalent unit $4.87 $11.27
Computation of Cost of ending WIP and units completed & transferred out - Weighted Average - Department 1
Particulars Material Conversion Total
Equivalent unit of Ending WIP 1000 700
Cost per equivalent unit $4.87 $11.27
Cost of Ending WIP (Equivalent unit * Cost per equivalent unit) $4,870 $7,889 $12,759
Units completed and transferred 46000 46000
Cost of units completed & Transferred (Unit completed * cost per equivalent unit) $224,020 $518,420 $742,440
Cost reconcilaition - Weighted Average - Department 1
Particulars Amount
Costs to be accounted for:
Cost of beginning WIP inventory $18,240.00
Cost added to production $736,959.00
Total Cost to be accounted for $755,199.00
Costs accounted for as follows:
Cost of unit transferred out $742,440
Ending WIP $12,759
Total cost accounted for $755,199.00

ekkarill92 answered 1 year ago
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