Question

The Assembly Department of Zip Surge Protectors began September with no work in process inventory. During the​ month, production that cost $50,786 ​(direct materials, $12,386​, and conversion​ costs, $38,400​) was started on 27,000 units. Zip completed and transferred to the Testing Department a total of 20,000 units. The ending work in process inventory was 36%

complete as to direct materials and 80% complete as to conversion work.

Requirements

1. Compute the equivalent units for direct materials and conversion costs.

2. Compute the cost per equivalent unit.

3. Assign the costs to units completed and transferred out and ending work in process inventory.

4. Record the journal entry for the costs transferred out of the Assembly Department to the Testing Department.

5. Post all of the transactions in the Work in Process

Inventorylong dash—Assembly

​T-account. What is the ending​ balance?

Zip Surge Protectors
Assembly Department
Flow of Physical Units and Computation of Equivalent Units
	Flow of	Equivalent Units
	Physical	Direct	Conversion
Flow of Production	Units	Materials	Costs

Completed and transferred out during September or Ending work process in Septermber 30 or Total Physical units Accounted for or

Requirement 2. Compute the cost per equivalent unit. ​(For entries with a zero​ balance, make sure to enter​ "0" in the appropriate column. Round the cost per equivalent unit to the nearest​ cent.)

Cost per Equibalent unit

	Direct Materials cost	Conversion costs

equirement 3. Assign the costs to units completed and transferred out and ending work in process inventory. ​(Enter quantities​ first, then the cost per equivalent unit amounts in the same order as calculated in the preceding step. Round your answers to the nearest whole​ dollar.)

Zip Surge Protectors
Assembly Department
Assignment of Costs
	Assign costs:	Direct Materials			Conversion Costs				Total
			x (		+		)
			x
							x
	Total cost accounted for

Requirement 4. Record the journal entry for the costs transferred out of the Assembly Department to the Testing Department. ​(Record debits​ first, then credits. Explanations are not​ required.)

Journal Entry
Date		Accounts	Debit	Credit

Requirement 5. Post the transactions to the Work in Process Inventorylong dash—Assembly ​T-account. What is the ending​ balance? ​(For entries with a zero​ balance, make sure to enter​ "0" in the appropriate column. Leave any unused cells​ blank.)

Work in Process Inventory—Assembly

Bal Sept 1
Bal sept 30

Answer 1

Quantity Schedule
Units in BWIP	0
Units started	27000
Units to be accounted for	27000
Units transferred out	20000
Units in EWIP	7000
Units accounted for	27000
Equivalent units for direct materials and conversion cost
	Flow of Physical units	Equivalent units Direct Material	Equivalent units Conversion cost
Beginning WIP	0	0	0
Units transferred out	20000	20000	20000
Ending WIP	7000	7000	7000
Percentage of completion		36%	80%
Equivalent units	7000	2520	5600
Total equivalent units	27000	22520	25600
Cost per equivalent unit
	Direct Material	Conversion cost	Total
BWIP	$0	$0	$0
Cost added in the period	$12,386	$38,400	$50,786
Cost to be accounted for	$12,386	$38,400	$50,786
Total equivalent units	22520	25600
Cost per equivalent unit	$0.55	$1.50	$2.05
Assignment of Costs
Assign Cost:	Direct Material	Conversion cost	Total
Units Trasfered out	20000 x $0.55 = 11000	20000 x $1.50 = $30000	$41,000.00
Ending Work in Process	2520 x $0.55 = $1386	5600 x $1.50 = $8400	$9,786.00
Total cost accounts for	$12,386	$38,400.00	$50,786.00
Journal entry
Work in Process Inventory-Testing Department			$41,000.00
Work in Process Inventory-Assembly Department				$41,000
Work in Process Inventory - Assembly Department
Balance Sept 1	$0	$41,000	WIP-Testing Dept
Direct Material	$12,386
Conversion Cost	$38,400
Balance Sept 30	$9,786