Question

Because most of the parts for its irrigation systems are standard, Waterways handles the majority of its manufacturing as a process cost system. There are multiple process departments. Three of these departments are the Molding, Cutting, and Welding departments. All items eventually end up in the Package department which prepares items for sale in kits or individually. The following information is available for the Molding department for January. Work in process beginning: Units in process 22,000 Stage of completion for materials 80% Stage of completion for labor and overhead 30% Costs in work in process inventory: Materials $168,360 Labor 67,564 Overhead 17,270 Total costs in beginning work in process $253,194 Units started into production in January 60,000 Units completed and transferred in January 58,000 Costs added to production: Materials $264,940 Labor 289,468 Overhead 60,578 Total costs added into production in January $614,986 Work in process ending: Units in process 24,000 Stage of completion for materials 50% Stage of completion for labor and overhead 10% Collapse question part

(a) Prepare a production cost report for Waterways using the weighted-average method. (Round unit costs to 2 decimal places, e.g. 2.25.)

Units to be accounted for Work in process, Jan. 1 253194

Started into production 60000

Total units Units accounted for

Transferred out

Work in process, Jan 31

Total units Costs

Materials

Conversion Costs

Total Unit costs Costs in January $ $ $

Equivalent units Unit costs $ $ $

Costs to be accounted for Work in process, Jan. 1 $

Started into production

Total costs $

Cost Reconciliation Schedule Costs accounted for

Transferred out $

Work in process, Jan. 31

Materials

Conversion costs

Total costs

Answer 1

UNITS TO ACCOUNT FOR:
Beginning Work in Process units				22,000
Add: Units Started in Process				60,000
Total Units to account for:				82,000
UNITS TO BE ACCOUNTED FOR:
Units started and completed				58,000
Ending Work in Process				24,000
Total Units to be accounted for:				82,000
Equivalent Units:
			Material Cost		Conversion
			% Completion	Units	% Completion	Units
Units started and completed			100%	58,000	100%	58,000
Ending Work in Process			50%	12,000	10%	2,400
Total Equivalent units				70,000		60,400
TOTAL COST TO ACCOUNT FOR:
			Material		Conversion
Beginning work in Process			168,360		84,834
Cost Added during May			264,940		350,046
Total Cost to account for:			433,300		434,880
Total Cost to account for:					868,180
COST PER EQUIVALENT UNIT:
			Material		Conversion
Total cost added during the year			433,300		434,880
Equivalent Units			70,000		60,400
Cost per Equivalent unit			6.19		7.2
TOTAL COST ACCOUNTED FOR:
Units started and Transferred out (58000 units)
			Equivalent unit	Cost per EU	Total Cost
Material			58,000	6.19	359020
Conversion Cost			58,000	7.2	417600
Total Cost of Units completed and transferred out:					776620
Ending Work in process (24000 units)
			Equivalent unit	Cost per EU	Total Cost
Material			12,000	6.19	74280
Conversison Cost			2,400	7.2	17280
Total cost of Ending Work in process:					91,560
RECONCILIATION STATEMENT:
Cost to be accounted fro:
Cost of Beginning WIP				253194
Cost added in production				614986
Total cost to be accounted				868180
Cost Accounted for:
Cost of units transferred out				776620
Ending WIP				91560
Total cost accounted for				868180