Because most of the parts for its irrigation systems are standard, Waterways han
ID: 2414142 • Letter: B
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
24,000
Stage of completion for materials
80%
Stage of completion for labor and overhead
30%
Costs in work in process inventory:
Materials
$172,460
Labor
68,900
Overhead
141,300
Total costs in beginning work in process
$382,660
Units started into production in January
71,000
Units completed and transferred in January
74,000
Costs added to production:
Materials
$378,605
Labor
690,080
Overhead
1,383,160
Total cots added into production in January
$2,451,845
Work in process ending
Units in process
21,000
Stage of completion for materials
75%
Stage of completion for labor and overhead
20%
Instructions:
Prepare a production cost report for Waterways using the weighted-average method.
Work in process beginning:
Units in process
24,000
Stage of completion for materials
80%
Stage of completion for labor and overhead
30%
Costs in work in process inventory:
Materials
$172,460
Labor
68,900
Overhead
141,300
Total costs in beginning work in process
$382,660
Units started into production in January
71,000
Units completed and transferred in January
74,000
Costs added to production:
Materials
$378,605
Labor
690,080
Overhead
1,383,160
Total cots added into production in January
$2,451,845
Work in process ending
Units in process
21,000
Stage of completion for materials
75%
Stage of completion for labor and overhead
20%
Explanation / Answer
Prepare production cost report :
Physical unit Direct material Conversion Units to account for Beginning work in process 24000 Units transferred in 71000 Total units to account for 95000 Units accounted for Units transferred out 74000 74000 74000 Ending work in process 21000 15750 4200 Total Units 95000 Equivalent unit of direct material 89750 Equivalent unit of conversion 78200 Total units to accounted for 95000 89750 78200 Cost information Direct material Conversion Total Beginning work in process 172460 210200 382660 Cost added 378605 2073240 2451845 Total cost 551065 2283440 2834505 Equivalent unit of production 89750 78200 Cost per equivalent unit 6.14 29.20 Cost accounted for Cost of units transferred out 2615160 Cost of ending work in process Material 96705 Conversion 122640 Total cost of ending work in process 219345 Total cost accounted 2834505