Question

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Clopack Company manufactures one product that goes through one processing department called Mixing. All raw materials are introduced at the start of work in the Mixing Department. The company uses the weighted-average method to account for units and costs. Its Work in Process T-account for the Mixing Department for June follows (all forthcoming questions pertain to June):

    

Work in Process—Mixing Department

June 1 balance	28,000		Completed and transferred    to Finished Goods	?
Materials	120,000
Direct labor	79,500
Overhead	97,000
June 30 balance	?

The June 1 work in process inventory consisted of 5,000 pounds with $16,000 in materials cost and $12,000 in conversion cost. The June 1 work in process inventory was 100% complete with respect to materials and 50% complete with respect to conversion. During June, 37,500 pounds were started into production. The June 30 work in process inventory consisted of 8,000 pounds that were 100% complete with respect to materials and 40% complete with respect to conversion. 10. What is the cost of ending work in process inventory for materials? (Do not round intermediate calculations.) 11. What is the cost of ending work in process inventory for conversion? 12. What is the cost of materials transferred to finished goods? 13. What is the amount of conversion cost transferred to finished goods? 14. Prepare the journal entry to record the transfer of costs from Work in Process to Finished Goods. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Record the transfer of costs from Work in Process to Finished Goods 15-a. What is the total cost to be accounted for?                  15-b. What is the total cost accounted for?

Answer 1

10. Cost of ending work in process inventory for materials = 8000 x $3.20 = $25600

11. Cost of ending work in process inventory for conversion = 3200 x $5 = $16000

12. Cost of materials transferred to finished goods = 34500 x $3.20 = $110400

13. Amount of conversion cost transferred to finished goods = 34500 x $5 = $172500

14.

General Journal	Debit	Credit
Finished goods inventory (34500 x $8.20)	282900
Work in process-Mixing department		282900
(To record transfer to finished goods)

15-a. Total cost to be accounted for = Beginning work in process $28000 + Materials $120000 + Direct labor $79500 + Overhead $97000 = $324500

15-b. Total cost accounted for = Cost of ending work in process $41600 ($25600 + $16000) + Costs transferred to finished goods $282900 ($110400 + $172500) = $324500

Working:

		Equivalent Units
Quantities	Physical Units	Materials	Conversion Costs
Units to be accounted for
Work in process, June 1	5000
Started into production	37500
Total units	42500
Units accounted for
Transferred out	34500	34500	34500
Work in process, June 30	8000	8000	3200
Total units	42500	42500	37700
Costs	Materials	Conversion Costs	Total
Total Costs $	136000	188500	324500
Equivalent units	42500	37700
Unit costs $	3.20	5.00	8.20