Question

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 of process costing. 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	35,000	Completed and transferred to Finished Goods	?
Materials	120,205
Direct labor	80,500
Overhead	98,000
June 30 balance	?

The June 1 work in process inventory consisted of 5,100 units with $18,570 in materials cost and $16,430 in conversion cost. The June 1 work in process inventory was 100% complete with respect to materials and 60% complete with respect to conversion. During June, 37,600 units were started into production. The June 30 work in process inventory consisted of 8,200 units that were 100% complete with respect to materials and 50% complete with respect to conversion.

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

• All working forms part of the answer
• Working for no. of units transferred

Units Reconciliation
Units to account for:
Beginning WIP	5,100 [given]
Units started this period	37,600 [given]
Total Units to account for	42,700
Total Units accounted for:
Completed & Transferred out	34,500 [42700 – 8200]
Ending WIP	8,200 [given]
Total Units accounted for	42,700

• Working for Equivalent units

EUP - Weighted Average Method	Units	% Material	EUP Materials	% Conversion	EUP - Conversion
Units TRANSFERRED	34,500	100%	34,500	100%	34,500
Units of ENDING WIP	8,200	100%	8,200	50%	4,100
Equivalent Units of Production			42,700		38,600

• Working for Cost per Equivalent units

COST per EUP			Material		Conversion
Cost of Beginning WIP			$        18,570.00		$          16,430.00
Cost incurred during the period			$      120,205.00		$        178,500.00
Total Costs		Costs	$      138,775.00	Costs	$        194,930.00
Equivalent units of production		EUP	42,700	EUP	38,600
Cost per EUP			$                   3.25		$                     5.05

• Cost transferred and Cost of ending WIP

TOTAL COST ACCOUNTED FOR
Cost of Units Transferred Out	EUP	Cost per EUP	Total Cost
- Direct Materials	34,500	$       3.25	$      112,125.00
- Conversion	34,500	$       5.05	$      174,225.00
Total Cost transferred Out				$            286,350.00 [USED in Journal Entry]
Costs of Ending WIP:	EUP	Cost per EUP	Total Cost
- Direct Materials	8,200	$       3.25	$        26,650.00
- Conversion	4,100	$       5.05	$        20,705.00
Total cost of ending WIP				$              47,355.00
Total costs accounted for					$        333,705.00

• Requirement 14: Journal Entry

Accounts title	Debit	Credit
Finished Goods Inventory	$ 286,350.00
Work In Process - Mixing Department		$ 286,350.00
(to record transfer of cost from WIP to Finished Goods)

• Requirement 15 (a) and 15 (b)

---15 (a)

		Material		Conversion
Beginning WIP cost		$        18,570.00		$          16,430.00
Cost incurred		$      120,205.00		$        178,500.00 [80500 + 98000]
	TOtal Costs	$      138,775.00	Total Costs	$        194,930.00

Total cost to be accounted for = 138775 + 194930 = $ 333,705

---15 (b)

TOTAL COST ACCOUNTED FOR
Cost of Units Transferred Out	EUP	Cost per EUP	Total Cost
- Direct Materials	34,500	$       3.25	$      112,125.00
- Conversion	34,500	$       5.05	$      174,225.00
Total Cost transferred Out				$            286,350.00
Costs of Ending WIP:	EUP	Cost per EUP	Total Cost
- Direct Materials	8,200	$       3.25	$        26,650.00
- Conversion	4,100	$       5.05	$        20,705.00
Total cost of ending WIP				$              47,355.00
Total costs accounted for					$        333,705.00

Total cost accounted for = 286350 + 47355 = $ 333,705