Because most of the parts for its irrigation systems are standard, Waterways han
ID: 2437907 • 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 22,000 Stage of completion for materials 80% Stage of completion for labor and overhead 30%
Costs in work in process inventory: Materials $168,360 Labor 67,564 Overhead 17,270 Total costs in beginning work in process $253,194
Units started into production in January 60,000 Units completed and transferred in January 58,000
Costs added to production: Materials $264,940 Labor 289,468 Overhead 60,578 Total costs added into production in January $614,986
Work in process ending: Units in process 24,000 Stage of completion for materials 50% Stage of completion for labor and overhead 10%
Collapse question part (a) Prepare a production cost report for Waterways using the weighted-average method. (Round unit costs to 2 decimal places, e.g. 2.25.)
WATERWAYS CORPORATION
Molding Department Production Report
Equivalent Units
Quantities Physical Units Materials Conversion Costs
Units to be accounted for
Work in process, Jan. 1
Started into production
Total units
Units accounted for
Transferred out
Work in process, Jan 31
Total units
Costs Materials Conversion Costs Total
Unit costs
Costs in January $ $ $
Equivalent units
Unit costs $ $ $
Costs to be accounted for
Work in process, Jan. 1 $
Started into production
Total costs $
Cost Reconciliation Schedule
Costs accounted for
Transferred out $
Work in process, Jan. 31
Materials
Conversion costs
Total costs $
Explanation / Answer
Answer 1. Weighted Average Method WATERWAYS CORPORATION MOLDING DEPARTMENT PRODUCTION REPORT For the Month ended Jan 31, 2017 Particulars Equivalent Units Physical Units Materials Conversion Costs Units to be accounted for Work in process - Beginning 22,000 Started into production 60,000 Total units 82,000 Units accounted for Transferred out 58,000 58,000 58,000 Work in process, Ending (82,000 - 58,000) 24,000 12,000 2,400 (50% materials, 10% conversion costs) Equivalent units accounted for 82,000 70,000 60,400 Costs Unit costs Materials Conversion Total WIP, Beginning 168,360 84,834 253,194 Costs incurred in November 264,940 350,046 614,986 Total Costs 433,300 434,880 868,180 Equivalent units 70,000 60,400 Costs per Equivalent Units 6.19 7.20 13.39 Cost Assignment Materials Conversion Total Good Units completed & Transferred out (58,000 Units) Cost of goods completed & Transferred out 359,020 417,600 776,620 Work in Process - ending Inventory - 24,000 Units 74,280 17,280 91,560 Total Cost accounted for 433,300 434,880 868,180 Cost Reconciliation Schedule Cost Accounted For: Transferred Out 776,620 WIP - Jan 31 Materials 74,280 Conversion Costs 17,280 91,560 Total Costs 868,180