In: Accounting
Can someone post a clean and organized excel version w/ the journal entries as well for the Weight Average AND FIFO solutions. Please!
The Company uses a single department production process.
Materials are added at the start of the production process and
labor and overhead are added as indicated. For January 2018, the
Company records have the following information:
UNITS:
Beginning
WIP:
10,000 units
100% complete for materials, 50% complete for labor; 3% complete for overhead
Units started in process 50,000 units
Units completed 49,000 units
Ending WIP: 11,000 units
100% complete for materials, 60% complete for labor; 20% complete for overhead
PRODUCTION COSTS:
Work in Process, Beginning of the
Month:
Materials
$ 22,000
Labor
18,000
Overhead
11,000
51,000
Current Month Costs:
Materials
$ 320,000
Labor
180,160
Overhead
152,840
653,000
Total Costs:
$
704,000
REQUIRED:
Prepare a Cost of Production Summary using the weighted average method (calculations for equivalent units of production, cost per equivalent unit of production, total cost for units completed and WIP, ending). Prepare your calculations for Materials, Labor, and Overhead separately. Prepare the appropriate journal entries at month end.
Prepare a Cost of Production Summary using the FIFO method (calculations for equivalent units of production, cost per equivalent unit of production, total cost for WIP, beginning, units started and completed and WIP, ending). Prepare your calculations for Materials, Labor, and Overhead separately. Prepare the appropriate journal entries at month end.
Weighted Average Method: | ||||||||
Units | Material Completion | Labor Completion | Overhead Completion | |||||
Beginning WIP | 10000 | 100% | 50% | 3% | ||||
Units Completed | 49000 | 100% | 100% | 100% | ||||
Closing WIP | 11000 | 100% | 60% | 20% | ||||
Equivalent Units:= Units Completed & Transferred + Closing Units*% of Completion (Respective) | ||||||||
Material Completion | Labor Completion | Overhead Completion | ||||||
Units Completed | 49000 | 49000 | 49000 | 49000 | (49000* Respective Completion %) | |||
Closing WIP | 11000 | 11000 | 6600 | 2200 | (11000* Respective Completion %) | |||
Total | 60000 | 55600 | 51200 | |||||
Material | Labor | Overhead | Total | |||||
Opening WIP Cost | 22000 | 18000 | 11000 | 51000 | ||||
Added Cost | 320000 | 180160 | 152840 | 653000 | ||||
Total Cost | 342000 | 198160 | 163840 | 704000 | ||||
Equivalent Units | 60000 | 55600 | 51200 | |||||
Cost per Equivalent Units | 5.70 | 3.56 | 3.20 | (Total Cost/E Units) | ||||
Allocation of Costs: | Material | Labor | Overhead | Total | ||||
To Unis Completed & Transferred | 279300 | 174637 | 156800 | 610737 | ||||
To Closing Stock | 62700 | 23523 | 7040 | 93263 | ||||
Total Cost | 342000 | 198160 | 163840 | 704000 | ||||
Material Account Dr. | 279300 | |||||||
Labor Account Dr. | 174637 | |||||||
Overhead Dr. | 156800 | |||||||
To WIP Account | 610737 | |||||||
(Being Cost transferred recorded) | ||||||||
FIFO Method: | ||||||||
Units | Material Completion | Labor Completion | Overhead Completion | |||||
Beginning WIP | 10000 | 100% | 50% | 3% | ||||
Units Completed: | 49000 | 100% | 100% | 100% | ||||
From Opening WIP | 10000 | 0% | 50% | 97% | ||||
From Current Production | 39000 | 100% | 100% | 100% | ||||
Closing WIP | 11000 | 100% | 60% | 20% | ||||
Equivalent Units:= Units Completed & Transferred + Closing Units*% of Completion (Respective) | ||||||||
Material Completion | Labor Completion | Overhead Completion | ||||||
Units Completed: | 49000 | |||||||
From Opening WIP | 10000 | 0 | 5000 | 9700 | (10000* Respective Completion %) | |||
From Current Production | 39000 | 39000 | 39000 | 39000 | (39000* Respective Completion %) | |||
Closing WIP | 11000 | 11000 | 6600 | 2200 | (11000* Respective Completion %) | |||
Total | 50000 | 50600 | 50900 | |||||
Material | Labor | Overhead | Total | |||||
Opening WIP Cost | 22000 | 18000 | 11000 | 51000 | ||||
Added Cost | 320000 | 180160 | 152840 | 653000 | ||||
Total Cost | 342000 | 198160 | 163840 | 704000 | ||||
Equivalent Units | 50000 | 50600 | 50900 | |||||
Cost per Equivalent Units | 6.84 | 3.92 | 3.22 | (Total Cost/E Units) | ||||
Allocation of Costs: | Material | Labor | Overhead | Total | ||||
Units Completed: | ||||||||
From Opening WIP | 0 | 19581 | 31223 | 50804 | ||||
From Current Production | 266760 | 152732 | 125536 | 545028 | ||||
Total Cost for Completed | 266760 | 172313 | 156759 | 595832 | ||||
To Closing Stock | 75240 | 25847 | 7081 | 108168 | ||||
Total Cost | 342000 | 198160 | 163840 | 704000 | ||||
Material Account Dr. | 266760 | |||||||
Labor Account Dr. | 172313 | |||||||
Overhead Dr. | 156759 | |||||||
To WIP Account | 595832 | |||||||
(Being Cost transferred recorded) | ||||||||