Managerial Accounting: Creating Value in a Dynamic Business Environment
12th Edition
ISBN: 9781260417074
Author: HILTON, Ronald
Publisher: MCGRAW-HILL HIGHER EDUCATION
expand_more
expand_more
format_list_bulleted
Concept explainers
Videos
Textbook Question
Chapter 4, Problem 35P
GroFast Company manufactures a high-quality fertilizer, which is used primarily by commercial vegetable growers. Two departments are involved in the production process. In the Mixing Department, various chemicals are entered into production. After processing, the Mixing Department transfers a chemical called Chemgro to the Finishing Department. There the product is completed, packaged, and shipped under the brand name Vegegro.
In the Mixing Department, the raw material is added at the beginning of the process. Labor and
The following information relates to production during November 20x2 in the Mixing Department.
- a. Work in process, November 1 (4,000 pounds, 75 percent complete as to conversion):
- b. Raw material:
- c. Direct-labor cost, $103,350
- d. Direct departmental overhead costs, $52,000
- e. Transferred to Finishing Department, 15,000 pounds
- f. Work in process, November 30, 5,000 pounds, 20 percent complete
The company uses weighted-average
Required:
- 1. Prepare a production report for the Mixing Department for November 20x2. The report should show:
- a.     Equivalent units of production by cost factor (i.e., direct material and conversion).
- b.     Cost per equivalent unit for each cost factor. (Round your answers to the nearest cent.)
- c.      Cost of Chemgro transferred to the Finishing Department.
- d.     Cost of the work-in-process inventory on November 30, 20x2, in the Mixing Department.
- 2. Prepare
journal entries to record the following events:- a.     Release of direct material to production during November.
- b.     Incurrence of direct-labor costs in November.
- c.      Application of overhead costs for the Mixing Department (direct departmental and allocated plant overhead costs.)
- d.     Transfer of Chemgro out of the Mixing Department.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Scribners Corporation produces fine papers in three production departments—Pulping, Drying, and Finishing. In the Pulping Department, raw materials such as wood fiber and rag cotton are mechanically and chemically treated to separate their fibers. The result is a thick slurry of fibers. In the Drying Department, the wet fibers transferred from the Pulping Department are laid down on porous webs, pressed to remove excess liquid, and dried in ovens. In the Finishing Department, the dried paper is coated, cut, and spooled onto reels. The company uses the weighted-average method in its process costing system. Data for March for the Drying Department follow:
Â
Â
Â
Percent Completed
Â
Units
Pulping
Conversion
Work in process inventory, March 1
3,800
100
%
Â
80
%
Work in process inventory, March 31
5,000
100
%
Â
75
%
Pulping cost in work in process inventory, March 1
Â
Â
Â
$
1,349
Â
Conversion cost in work in process inventory, March 1
Â
Â
Â
$
684
Â
Units transferred to the…
Scribners Corporation produces fine papers in three production departments—Pulping, Drying, and Finishing. In the Pulping Department, raw materials such as wood fiber and rag cotton are mechanically and chemically treated to separate their fibers. The result is a thick slurry of fibers. In the Drying Department, the wet fibers transferred from the Pulping Department are laid down on porous webs, pressed to remove excess liquid, and dried in ovens. In the Finishing Department, the dried paper is coated, cut, and spooled onto reels. The company uses the weighted-average method in its process costing system. Data for March for the Drying Department follow:
Â
Â
Â
Percent Completed
Â
Units
Pulping
Conversion
Work in process inventory, March 1
3,500
100
%
Â
80
%
Work in process inventory, March 31
7,500
100
%
Â
60
%
Pulping cost in work in process inventory, March 1
Â
Â
Â
$
1,085
Â
Conversion cost in work in process inventory, March 1
Â
Â
Â
$
350
Â
Units transferred to the…
Scribners Corporation produces fine papers in three production departments—Pulping, Drying, and Finishing. In the Pulping Department, raw materials such as wood fiber and rag cotton are mechanically and chemically treated to separate their fibers. The result is a thick slurry of fibers. In the Drying Department, the wet fibers transferred from the Pulping Department are laid down on porous webs, pressed to remove excess liquid, and dried in ovens. In the Finishing Department, the dried paper is coated, cut, and spooled onto reels. The company uses the weighted-average method in its process costing system. Data for March for the Drying Department follow:
Â
Â
Units
Percent Completed
Pulping
Conversion
Work in process inventory, March 1
4,000
100%
80%
Work in process inventory, March 31
8,000
100%
75%
Pulping cost in work in process inventory, March 1
Â
Â
$ 2,860
Conversion cost in work in process inventory, March 1
Â
Â
$ 800
Units transferred to the next production…
Chapter 4 Solutions
Managerial Accounting: Creating Value in a Dynamic Business Environment
Ch. 4 - Explain the primary differences between job-order...Ch. 4 - List five types of manufacturing in which process...Ch. 4 - Prob. 3RQCh. 4 - What are the purposes of a product-costing system?Ch. 4 - Define the term equivalent unit and explain how...Ch. 4 - List and briefly describe the purpose of each of...Ch. 4 - Show how to prepare a journal entry to enter...Ch. 4 - Prob. 8RQCh. 4 - Prob. 9RQCh. 4 - Prob. 10RQ
Ch. 4 - How would the process-costing computations differ...Ch. 4 - Explain the concept of operation costing. How does...Ch. 4 - Prob. 13RQCh. 4 - In each case below, fill in the missing amount.Ch. 4 - Rainbow Glass Company manufactures decorative...Ch. 4 - Terra Energy Company refines a variety of...Ch. 4 - The Evanston plant of Fit-for-Life Foods...Ch. 4 - Idaho Lumber Company grows, harvests, and...Ch. 4 - Otsego Glass Company manufactures window glass for...Ch. 4 - Savannah Textiles Company manufactures a variety...Ch. 4 - The following data pertain to Tulsa Paperboard...Ch. 4 - The November production of MVPs Minnesota Division...Ch. 4 - Timing Technology, Inc. manufactures timing...Ch. 4 - Piscataway Plastics Company manufactures a highly...Ch. 4 - The following data pertain to the Vesuvius Tile...Ch. 4 - Triangle Fastener Corporation accumulates costs...Ch. 4 - Moravia Company processes and packages cream...Ch. 4 - Albany Company accumulates costs for its product...Ch. 4 - Goodson Corporation assembles various components...Ch. 4 - A-1 Products manufactures wooden furniture using...Ch. 4 - The following data pertain to the Hercules Tire...Ch. 4 - Scrooge and Zilch, a public accounting firm in...Ch. 4 - GroFast Company manufactures a high-quality...Ch. 4 - Plasto Corporation manufactures a variety of...Ch. 4 - (Contributed by Roland Minch.) Glass Glow Company...Ch. 4 - Orbital Industries of Canada, Inc. manufactures a...Ch. 4 - Laredo Leather Company manufactures high-quality...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Scribners Corporation produces fine papers in three production departments—Pulping, Drying, and Finishing. In the Pulping Department, raw materials such as wood fiber and rag cotton are mechanically and chemically treated to separate their fibers. The result is a thick slurry of fibers. In the Drying Department, the wet fibers transferred from the Pulping Department are laid down on porous webs, pressed to remove excess liquid, and dried in ovens. In the Finishing Department, thedried paper is coated, cut, and spooled onto reels. The company uses the weighted-average method in its process costing system. Data for March for the Drying Department follow: No materials are added in the Drying Department. Pulping cost represents the costs of the wet fibers transferred in from the Pulping Department. Wet fiber is processed in the Drying Department in batches; each unit in the above table is a batch and one batch of wet fibers produces a setamount of dried paper that is passed on to the…arrow_forwardScribners Corporation produces fine papers in three production departments-Pulping, Drying, and Finishing. In the Pulping Department, raw materials such as wood fiber and rag cotton are mechanically and chemically treated to separate their fibers. The result is a thick slurry of fibers. In the Drying Department, the wet fibers transferred from the Pulping Department are laid down on porous webs, pressed to remove excess liquid, and dried in ovens. In the Finishing Department, the dried paper is coated, cut, and spooled onto reels. The company uses the weighted-average method in its process costing system. Data for March for the Drying Department follow: Percent Completed Units Pulping Conversion 20% Work in process inventory, March 1 Work in process inventory, March 31 5,000 100% 8,000 100% 25% $4,800 $500 Pulping cost in work in process inventory, March 1 Conversion cost in work in process inventory, March 1 Units transferred to the next production department Pulping cost added during…arrow_forwardScribners Corporation produces fine papers in three production departments-Pulping, Drying, and Finishing. In the Pulping Department, raw materials such as wood fiber and rag cotton are mechanically and chemically treated to separate their fibers. The result is a thick slurry of fibers. In the Drying Department, the wet fibers transferred from the Pulping Department are laid down on porous webs, pressed to remove excess liquid, and dried in ovens. In the Finishing Department, the dried paper is coated, cut, and spooled onto reels. The company uses the weighted-average method in its process costing system. Data for March for the Drying Department follow: Percent Completed Pulping 100% Units Conversion Work in process inventory, March 1 Work in process inventory, March 31 Pulping cost in work in process inventory, March 1 Conversion cost in work in process inventory, March 1 Units transferred to the next production department Pulping cost added during March Conversion cost added during…arrow_forward
- Scribners Corporation produces fine papers in three production departments-Pulping, Drying, and Finishing. In the Pulping Department, raw materials such as wood fiber and rag cotton are mechanically and chemically treated to separate their fibers. The result is a thick slurry of fibers. In the Drying Department, the wet fibers transferred from the Pulping Department are laid down on porous webs, pressed to remove excess liquid, and dried in ovens. In the Finishing Department, the dried paper is coated, cut, and spooled onto reels. The company uses the weighted-average method in its process costing system. Data for March for the Drying Department follow: Work in process inventory, March 1 Work in process inventory, March 31 Pulping cost in work in process inventory, March 1 Conversion cost in work in process inventory, March 1 Units transferred to the next production department Pulping cost added during March Conversion cost added during March Units Percent Completed Pulping Conversion…arrow_forwardScribners Corporation produces fine papers in three production departments-Pulping, Drying, and Finishing. In the Pulping Department, raw materials such as wood fiber and rag cotton are mechanically and chemically treated to separate their fibers. The result is a thick slurry of fibers. In the Drying Department, the wet fibers transferred from the Pulping Department are laid down on porous webs, pressed to remove excess liquid, and dried in ovens. In the Finishing Department, the dried paper is coated, cut, and spooled onto reels. The company uses the weighted-average method in its process costing system. Data for March for the Drying Department follow: Work in process inventory, March 1 Work in process inventory, March 31 Pulping cost in work in process inventory, March 1 Conversion cost in work in process inventory, March 1 Units transferred to the next production department Pulping cost added during March Conversion cost added during March Complete this question by entering your…arrow_forwardScribners Corporation produces fine papers in three production departments-Pulping, Drying, and Finishing. In the Pulping Department, raw materials such as wood fiber and rag cotton are mechanically and chemically treated to separate their fibers. The result is a thick slurry of fibers. In the Drying Department, the wet fibers transferred from the Pulping Department are laid down on porous webs, pressed to remove excess liquid, and dried in ovens. In the Finishing Department, the dried paper is coated, cut, and spooled onto reels. The company uses the weighted-average method in its process costing system. Data for March for the Drying Department follow: Percent Completed Pulping 100% Conversion 80% Units 2,700 7,500 Work in process inventory, March 1 Work in process inventory, March-31 Pulping cost in work in process inventory, March 1 Conversion cost in work in process inventory, March 1 Units transferred to the next production department Pulping cost added during March Conversion…arrow_forward
- Caricolor Limited operates a paint manufacturing plant, housing two distinct departments: the mixing department and the quality control department. The paint undergoes sequential processing in both of these departments. The company's process-costing system is structured around two primary cost categories: direct materials and conversion costs. Direct materials are introduced at the initial stages of the process, while conversion costs are gradually incurred throughout the process. After completing the mixing department's tasks on the paint, the product is promptly forwarded to the quality control department. Caricolor employs the weighted-average method for process costing to calculate its manufacturing costs.  Data for the mixing department for October 2020 are as follows:                                                                    Physical Units       Cost                     (Gallons…arrow_forwardPassion Limited operates a paint manufacturing plant, housing two distinct departments: the mixing department and the quality control department. The paint undergoes sequential processing in both of these departments. The company's process-costing system is structured around two primary cost categories: direct materials and conversion costs. Direct materials are introduced at the initial stages of the process, while conversion costs are gradually incurred throughout the process. After completion of the mixing department's tasks on the paint, the product is promptly forwarded to the quality control department. Passion employs the weighted-average method for process costing to calculate its manufacturing costs. Data for the mixing department for October 2020 are as follows: Physical Units  Gallons of Paint Direct Materials Conversion Costs    Work in process, October 1x 8,000 $1,400,000 $450,700 Started during October 2020 22,000   Completed during October 2020…arrow_forwardPassion Limited operates a paint manufacturing plant, housing two distinct departments: the mixing department and the quality control department. The paint undergoes sequential processing in both of these departments. The company's process-costing system is structured around two primary cost categories: direct materials and conversion costs. Direct materials are introduced at the initial stages of the process, while conversion costs are gradually incurred throughout the process. After completion of the mixing department's tasks on the paint, the product is promptly forwarded to the quality control department. Passion employs the weighted-average method for process costing to calculate its manufacturing costs. Data for the mixing department for October 2020 are as follows: Physical Units  Gallons of Paint Direct Materials Conversion Costs    Work in process, October 1x 8,000 $1,400,000 $450,700 Started during October 2020 22,000   Completed during October 2020…arrow_forward
- Caricolor Limited operates a paint manufacturing plant, housing two distinct departments: the mixing department and the quality control department. The paint undergoes sequential processing in both of these departments. The company's process-costing system is structured around two primary cost categories: direct materials and conversion costs. Direct materials are introduced at the initial stages of the process, while conversion costs are gradually incurred throughout the process. After completing the mixing department's tasks on the paint, the product is promptly forwarded to the quality control department. Caricolor employs the weighted-average method for process costing to calculate its manufacturing costs.  Data for the mixing department for October 2020 are as follows:                                                                    Physical Units       Cost                     (Gallons…arrow_forwardHealthway uses a process-costing system to compute the unit costs of the minerals that it produces. It has three departments: Mixing, Tableting, and Bottling. In Mixing, at the beginning of the process all materials are added and the ingredients for the minerals are measured, sifted, and blended together. The mix is transferred out in gallon containers. The Tableting Department takes the powdered mix and places it in capsules. One gallon of powdered mix converts to 1,600 capsules. After the capsules are filled and polished, they are transferred to Bottling where they are placed in bottles, which are then affixed with a safety seal and a lid and labeled. Each bottle receives 50 capsules. During July, the following results are available for the first two departments (direct materials are added at the beginning in both departments): Overhead in both departments is applied as a percentage of direct labor costs. In the Mixing Department, overhead is 200 percent of direct labor. In the Tableting Department, the overhead rate is 150 percent of direct labor. Required: 1. Prepare a production report for the Mixing Department using the weighted average method. Follow the five steps outlined in the chapter. Round unit cost to three decimal places. 2. Prepare a production report for the Tableting Department. Materials are added at the beginning of the process. Follow the five steps outlined in the chapter. Round unit cost to four decimal places.arrow_forwardBenson Pharmaceuticals uses a process-costing system to compute the unit costs of the over-the-counter cold remedies that it produces. It has three departments: mixing, encapsulating, and bottling. In mixing, the ingredients for the cold capsules are measured, sifted, and blended (with materials assumed to be uniformly added throughout the process). The mix is transferred out in gallon containers. The encapsulating department takes the powdered mix and places it in capsules (which are necessarily added at the beginning of the process). One gallon of powdered mix converts into 1,500 capsules. After the capsules are filled and polished, they are transferred to bottling, where they are placed in bottles that are then affixed with a safety seal, lid, and label. Each bottle receives 50 capsules. During March, the following results are available for the first two departments: Overhead in both departments is applied as a percentage of direct labor costs. In the mixing department, overhead is 200% of direct labor. In the encapsulating department, the overhead rate is 150% of direct labor. Required: 1. Prepare a production report for the mixing department using the weighted average method. Follow the five steps outlined in the chapter. (Note: Round to two decimal places for the unit cost.) 2. Prepare a production report for the encapsulating department using the weighted average method. Follow the five steps outlined in the chapter. (Note: Round to four decimal places for the unit cost.) 3. CONCEPTUAL CONNECTION Explain why the weighted average method is easier to use than FIFO. Explain when weighted average will give about the same results as FIFO.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Cornerstones of Cost Management (Cornerstones Ser...AccountingISBN:9781305970663Author:Don R. Hansen, Maryanne M. MowenPublisher:Cengage Learning
Managerial Accounting: The Cornerstone of Busines...AccountingISBN:9781337115773Author:Maryanne M. Mowen, Don R. Hansen, Dan L. HeitgerPublisher:Cengage Learning
Cornerstones of Cost Management (Cornerstones Ser...
Accounting
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Cengage Learning
Managerial Accounting: The Cornerstone of Busines...
Accounting
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Cengage Learning
Cost Accounting - Definition, Purpose, Types, How it Works?; Author: WallStreetMojo;https://www.youtube.com/watch?v=AwrwUf8vYEY;License: Standard YouTube License, CC-BY