Question

Work in Process Account Data for Two Months; Cost of Production Reports

Hearty Soup Co. uses a process cost system to record the costs of processing soup, which requires the cooking and filling processes. Materials are entered from the cooking process at the beginning of the filling process. The inventory of Work in Process—Filling on April 1 and debits to the account during April were as follows:

Bal., 1,000 units, 40% completed:
	Direct materials (1,000 x $7.90)	$ 7,900
	Conversion (1,000 x 40% x $3.30)	1,320
		$ 9,220
From Cooking Department, 22,400 units		$179,200
Direct labor		49,637
Factory overhead		26,727

During April, 1,000 units in process on April 1 were completed, and of the 22,400 units entering the department, all were completed except 1,800 units that were 70% completed. Charges to Work in Process—Filling for May were as follows:

From Cooking Department, 25,800 units	$211,560
Direct labor	59,630
Factory overhead	32,105

During May, the units in process at the beginning of the month were completed, and of the 25,800 units entering the department, all were completed except 1,300 units that were 90% completed.

Required:

1. Enter the balance as of April 1 in a four-column account for Work in Process—Filling. Record the debits and credits in the account for April. Construct a cost of production report and present computations for determining (a) equivalent units of production for materials and conversion; (b) cost per equivalent unit; (c) cost of goods finished, differentiating between units started in the prior period and units started and finished in April; and (d) work in process inventory. If an amount box does not require an entry, leave it blank.

ACCOUNT	Work in Process-Filling Department				ACCOUNT NO.
					BALANCE
DATE	ITEM	POST. REF.	DEBIT	CREDIT	DEBIT	CREDIT
Apr. 1	Bal., 1,000 units, 40% completed
30	Cooking Dept., 22,400 units at $8.00
30	Direct labor
30	Factory overhead
30	Finished goods
30	Bal., 1,800 units, 70% completed

If an amount is zero, enter in a zero "0". Round cost per unit answers to the nearest cent.

Hearty Soup Co. Cost of Production Report-Filling Department For the Month Ended April 30
	Whole Units	Equivalent Units
Units		Direct Materials (a)	Conversion (a)
Units charged to production:
Inventory in process, April 1
Received from Cooking Department
Total units accounted for by the Filling Department
Units to be assigned costs:
Inventory in process, April 1
Started and completed in April
Transferred to finished goods in April
Inventory in process, April 30
Total units to be assigned costs

	Costs
Costs		Direct Materials				Conversion				Total
Costs per equivalent unit:
Total costs for April in Filling Department		$				$
Total equivalent units
Cost per equivalent unit (b)		$				$
Costs charged to production:
Inventory in process, April 1										$
Costs incurred in April
Total costs accounted for by the Filling Department										$
Cost allocated to completed and partially completed units:
Inventory in process, April 1 balance (c)										$
To complete inventory in process, April 1 (c)		$				$
Cost of completed April 1 work in process										$
Started and completed in April (c)
Transferred to finished goods in April (c)										$
Inventory in process, April 30 (d)
Total costs assigned by the Filling Department										$

2. Provide the same information for May by recording the May transactions in the four-column work in process account. Construct a cost of production report and present the May computations (a through d) listed in part (1). If an amount box does not require an entry, leave it blank.

ACCOUNT	Work in Process-Filling Department				ACCOUNT NO.
					Balance
DATE	ITEM	POST. REF.	DEBIT	CREDIT	DEBIT	CREDIT
May 1	Balance
31	Cooking Dept., 25,800 units at $8.2
31	Direct labor
31	Factory overhead
31	Finished goods
31	Bal., 1,300 units, 90% completed

If an amount is zero, enter in a zero "0". Round cost per unit answers to the nearest cent.

Hearty Soup Co. Cost of Production Report-Filling Department For the Month Ended May 31
	Whole Units	Equivalent Units
Units		Direct Materials (a)	Conversion (a)
Units charged to production:
Inventory in process, May 1
Received from Cooking Department
Total units accounted for by the Filling Department
Units to be assigned costs:
Inventory in process, May 1
Started and completed in May
Transferred to finished goods in May
Inventory in process, May 31
Total units to be assigned costs

Answer 1

Solotion 1:
Account	Work in Pocess- Filling Department
				Balance
Date	Item	Debit	Credit	Debit	Credit
1-Apr	Balance			$9,220
30-Apr	Cooking department	$179,200		$188,420
30-Apr	Direct labor	49637		$238,057
30-Apr	Factory Overhead	26727		$264,784
30-Apr	Finished Goods		$246,100	$18,684
30-Apr	Ending balance			$18,684
	Hearty Soup Co.
	Cost of Production Report-Filling Department
	For the Month Ended April 30
	UNITS	Whole Units	Equivalent Units
	Direct Materials	Conversion
	Units charged to production:
	Inventory in process, April 1	1000
	Received from Cooking Department	22400
	Total units accounted for by the Filling Department	23400
	Units to be assigned costs:
	Inventory in process, April 1	1000	0	600
	Started and completed in April (21600-1000)	20600	20600	20600
	Transferred to Finished goods in april	21600	20600	21200
	Inventory in process, April 30	1800	1800	1260
	Total units to be assigned costs	23400	22400	22460
	COSTS	Costs
	Direct Materials	Conversion	Total
	Cost per equivalent unit:
	Total costs for April in Filling Department	$179,200	$76,364
	/Total equivalent units	22400	22460
	Cost per equivalent unit	$8.00	$3.40	$11.40
	Costs assigned to production:
	Inventory in process, April 1			$9,220
	Costs incurred in April			$255,564
	Total costs accounted for by the Filling Department			$264,784
	Costs allocated to completed and partially completed units:
	Inventory in process, April 1-balance			$9,220
	To complete inventory in process, April 1	$0	$2,040	$2,040
	Cost of completed April 1 work in process			$11,260
	Started and completed in April	$164,800	$70,040	$234,840
	Transferred to Finished goods in April			$246,100
	Inventory in process, April 30	$14,400	$4,284	$18,684
	Total costs assigned by the Filling Department			$264,784
Solution 2:
Account	Work in Pocess- Filling Department
				Balance
Date	Item	Debit	Credit	Debit	Credit
1-May	Balance			$18,684
31-May	Cooking department	$211,560		$230,244
31-May	Direct labor	59630		$289,874
31-May	Factory Overhead	32105		$321,979
31-May	Finished Goods		$307,224	$14,755
31-May	Ending Balance			$14,755
	Hearty Soup Co.
	Cost of Production Report-Filling Department
	For the Month Ended May 31
	UNITS	Whole Units	Equivalent Units
	Direct Materials	Conversion
	Units charged to production:
	Inventory in process, May 1	1800
	Received from Cooking Department	25800
	Total units accounted for by the Filling Department	27600
	Units to be assigned costs:
	Inventory in process, May 1	1800	0	540
	Started and completed in May	24500	24500	24500
	Transferred to Finished goods in May	26300	24500	25040
	Inventory in process, May 31	1300	1300	1170
	Total units to be assigned costs	27600	25800	26210
	COSTS	Costs
	Direct Materials	Conversion	Total
	Cost per equivalent unit:
	Total costs for May in Filling Department	$211,560	$91,735
	/Total equivalent units	25800	26210
	Cost per equivalent unit	$8.20	$3.50	$11.70
	Costs assigned to production:
	Inventory in process, May 1			$18,684
	Costs incurred in April			$303,295
	Total costs accounted for by the Filling Department			$321,979
	Costs allocated to completed and partially completed units:
	Inventory in process, May 1-balance			$18,684
	To complete inventory in process, May 1	$0	$1,890	$1,890
	Cost of completed May 1 work in process			$20,574
	Started and completed in May	$200,900	$85,750	$286,650
	Transferred to Finished goods in May			$307,224
	Inventory in process, May 30	$10,660	$4,095	$14,755
	Total costs assigned by the Filling Department			$321,979