Casey Carpet manufactures broadloom carpet in seven processes: Spinning, Dyeing,
ID: 2600583 • Letter: C
Question
Casey Carpet manufactures broadloom carpet in seven processes: Spinning, Dyeing, Plying, Spooling, Tufting, Latexing and Shearing. In the Dyeing Department the direct materials (dye) are added at the beginning of the process. Conversion costs are incurred evenly throughout the process. Casey uses FIFO process costing. Information for March 2011 follows:
Units:
Beginning work in process inventory (40% complete as
to conversion work)
90
rolls
Transferred in from Spinning Department during March
750
rolls
Completed during March
780
rolls
Ending work in process (75% complete as to
conversion work)
60
rolls
Costs:
Beginning work in process (transferred-in cost, $2,286;
materials cost, $4,140; conversion costs, $1,125)
$7,551
Transferred in from Spinning Department during March
12,750
Materials cost added during March
34,500
Conversion costs added during March (manufacturing
wages, $8,880; manufacturing overhead, $70,020)
78,900
Requirements
1.
Casey's Dyeing Department.
2.
Casey's Dyeing Department for March using the FIFO method.
3.
Casey's Dyeing Department.
(Round your answers to the nearest whole dollar. For entries with a $0 balance, make sure to enter "0" in the appropriate column.)
4.
Journalize all transactions affecting
Casey's Dyeing Department during March, including the entries that have already been posted.
Units:
Beginning work in process inventory (40% complete as
to conversion work)
90
rolls
Transferred in from Spinning Department during March
750
rolls
Completed during March
780
rolls
Ending work in process (75% complete as to
conversion work)
60
rolls
Costs:
Beginning work in process (transferred-in cost, $2,286;
materials cost, $4,140; conversion costs, $1,125)
$7,551
Transferred in from Spinning Department during March
12,750
Materials cost added during March
34,500
Conversion costs added during March (manufacturing
wages, $8,880; manufacturing overhead, $70,020)
78,900
Explanation / Answer
Equivalent Unit Computation (Weighted-Average)
Month Ended March 31
Flow of
Equivalent Units
Flow of Production
Physical Units
Transferred In
Direct Materials
Conversion Costs
Completed and transferred out
500
500
500
500
Ending work in process, March 31
135
135a
135a
108b
Total physical units accounted for
635
Equivalent units
635
635
608
__________
a The time line shows that transferred-in costs and direct materials are incurred at the beginning of the Dyeing process. The ending inventory did pass the point where transferred in and direct material costs are incurred. The ending inventory is therefore complete with respect to transferred-in costs and direct materials.
b 80% of the conversion work on ending work in process inventory was done in March:
135 × 80% = 108
Casey Carpet
Dyeing Department
Cost per Equivalent Unit
Month Ended March 31
Transferred In
Direct Materials
Conversion Costs
Total
Beginning work in process,
February 28
$4,500
$1,755
$5,199
$11,454
Costs added during March
21,535
12,850
51,953
86,338
Total costs
$26,035
$14,605
$57,152
Divide by equivalent units
÷635
÷635
÷608
Cost per equivalent unit
$41
$23
$94
Total cost to account for
$97,792
Req. 3
Casey Carpet
Dyeing Department
Production Cost Report (Weighted-Average Method)
Month Ended March 31
Transferred In
Direct Materials
Conversion Costs
Total
Beginning work in process, February 28
$4,500
$1,755
$5,199
$11,454
Costs added during March
21,535
12,850
51,953
86,338
Total cost to account for
$26,035
$14,605
$57,152
$97,792
Divide by equivalent units
÷635
÷635
÷608
Cost per equivalent unit
$41
$23
$94
Assignment of total costs:
Units completed and transferred out
during March
500 × ($41 + $23 + $94)
$79,000
Ending work in process, March 31:
Transferred in costs
135 × $41
5,535
Direct materials
135 × $23
3,105
Conversion costs
108 × $94
10,152
Total ending work in process, March 31
18,792
Total cost accounted for
$97,792
Req. 4
Journal Entry
DATE
ACCOUNTS
POST. REF.
DEBIT
CREDIT
Work in Process Inventory—Dyeing
21,535
Work in Process Inventory—Spinning
21,535
Work in Process Inventory—Dyeing
64,803
Materials Inventory
12,850
Manufacturing Wages
8,445
Manufacturing Overhead
43,508
Work in Process Inventory—Plying
79,000
Work in Process Inventory—Dyeing
79,000
Equivalent Unit Computation (Weighted-Average)
Month Ended March 31
Flow of
Equivalent Units
Flow of Production
Physical Units
Transferred In
Direct Materials
Conversion Costs
Completed and transferred out
500
500
500
500
Ending work in process, March 31
135
135a
135a
108b
Total physical units accounted for
635
Equivalent units
635
635
608