Managerial Accounting (5th Edition)
5th Edition
ISBN: 9780134128528
Author: Karen W. Braun, Wendy M. Tietz
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Concept explainers
Videos
Textbook Question
Chapter 5, Problem 5.23AE
Analyze flow of costs through inventory T-accounts (Learning Objective 1)
Golden Sun Bakery mass-produces bread using three sequential processing departments: Mixing, Baking, and Packaging. The following transactions occurred during April:
| 1. Direct materials used in the Packaging Department | $ 34,000 |
| 2. Costs assigned to units completed and transferred out of Mixing | $227,000 |
| 3. Direct labor incurred in the Mixing Department | $ 11,400 |
| 4. Beginning balance: Work in Process Inventory—Baking | $15,800 |
| 5 Manufacturing |
$ 78,000 |
| 6. Beginning balance: Finished Goods | $ 4,600 |
| 7 Costs assigned to units completed and transferred out of Baking | $308,000 |
| 8. Beginning balance: Work in Process Inventory—Mixing | $ 12,100 |
| 9. Direct labor incurred in the Packaging Department | $ 8,900 |
| 10. Manufacturing overhead allocated to the Mixing Department | $68,000 |
| 11. Direct materials used in the Mixing Department | $156,000 |
| 12. Beginning balance: Raw Materials Inventory | $ 23,200 |
| 13. Costs assigned to units completed and transferred out of Packaging | $385,000 |
| 14. Beginning balance: Work in Process Inventory—Packaging | $ 8,000 |
| 15. Purchases of Raw Materials | $179,000 |
| 16. Direct labor incurred in the Baking Department | $4,200 |
| 17. Manufacturing overhead allocated to the Packaging Department | $40,000 |
| 18. Cost of goods sold | $386,000 |
Note: No direct materials were used by the Baking Department.
Requirements
- 1. Post each of these transactions to the company’s inventory T-accounts. You should set up separate T-accounts for the following:
- Raw Materials Inventory
- Work in Process Inventory—Mixing Department
- Work in Process Inventory—Baking Department
- Work in Process Inventory—Packaging Department
- Finished Goods Inventory
- 2. Determine the balance at month end in each of the inventory accounts.
- 3. Assume that 3,025,000 loaves of bread were completed and transferred out of the Packaging Department during the month. What was the cost per unit of making each loaf of bread (from start to finish)?
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
S5-13 Find unit cost and gross profit on a final product (Learning Objective 5)
Counter Co. produces Formica countertops in two sequential production departments:
Forming and Polishing. The Polishing Department calculated the following costs per
equivalent unit (square feet) on its October production cost report:
Transferred-in
$2.44
Direct Materials Conversion Costs
$0.40
$1.66
Cost per equivalent unit:
During October, 165,000 square feet were completed and transferred out of the
Polishing Department to Finished Goods Inventory. The countertops were subsequently
sold for $13.00 per square foot.
1. What was the cost per square foot of the finished product?
2. Did most of the production cost occur in the Forming Department or in the Polishing
Department? Explain how you can tell where the most production cost occurred.
3. What was the gross profit per square foot?
4. What was the total gross profit on the countertops produced in October?
$4-3 Compute departmental overhead rates (Learning Objective 1)
Snyder Snacks makes potato chips, corn chips, and cheese puffs using three different pro-
du
es wi
the same manufacturing plant. Currently, Snyder uses a single plant-
wide overhead rate to allocate its $3,311,500 of annual manufacturing overhead. Of this
amount, $2,070,000 is associated with the potato chip line, $763,000 is associated with
the corn chip line, and $478,500 is associated with the cheese puff line. Snyder's plant is
currently running a total of 17,900 machine hours: 11,500 in the potato chip line, 3,500 in
the corn chip line, and 2,900 in the cheese puff line. Snyder considers machine hours to
be the cost driver of manufacturing overhead costs.
1. What is Snyder's plantwide overhead rate?
2. Calculate the departmental overhead rates for Snyder's three production lines. Round
all answers to the nearest cent.
3. Which products have been overcosted by the plantwide rate? Which products have
been undercosted by…
Required information
Use the following information for the Exercises below. (Algo)
[The following information applies to the questions displayed below.]
The first production department of Stone Incorporated reports the following for April.
Beginning work in process inventory
Units started this period
Completed and transferred out
Ending work in process inventory
Show Transcribed Text
Units
72,000
382,000
360,000
94,000
The production department had the cost information below.
Beginning work in process inventory
Direct materials
Costs added this period
Direct materials
Conversion
Total costs to account for
3
Exercise 3-9 (Algo) Weighted average: Cost per equivalent unit; costs assigned to output and inventory
LO P1
Direct
Materials
Percent
Complete
70%
$ 167,920
38,028
80%
1,115,920
777,192
C
Exercise 3-9 (Algo) Weighted average: Cost per equivalent unit; costs assigned to output and inventory
LO P1
$ 205,948
Conversion
1,893,112
$ 2,099,060
Percent Complete
a. Compute cost per…
Chapter 5 Solutions
Managerial Accounting (5th Edition)
Ch. 5 - (Learning Objective 1) Which of the following is...Ch. 5 - (Learning Objective 2) Conversion costs consist of...Ch. 5 - (Learning Objective 2) Which of the following is...Ch. 5 - (Learning Objective 3) Which of the following is...Ch. 5 - Prob. 5QCCh. 5 - (Learning Objective 4) The journal entry needed to...Ch. 5 - (Learning Objective 4) A company has two...Ch. 5 - Prob. 8QCCh. 5 - Prob. 9QCCh. 5 - Prob. 10QC
Ch. 5 - Compare job costing and process costing (Learning...Ch. 5 - Prob. 5.2SECh. 5 - Prob. 5.3SECh. 5 - Determine the physical flow of units (process...Ch. 5 - Compute equivalent units (process costing Step 2)...Ch. 5 - Compute equivalent units (process costing Step 2)...Ch. 5 - Summarize total costs to account for (process...Ch. 5 - Prob. 5.8SECh. 5 - Prob. 5.9SECh. 5 - Prob. 5.10SECh. 5 - Prob. 5.11SECh. 5 - Prob. 5.12SECh. 5 - Prob. 5.13SECh. 5 - Prob. 5.14SECh. 5 - Prob. 5.15SECh. 5 - Prob. 5.16SECh. 5 - Continuation of S5-16: Record journal entry and...Ch. 5 - Compute equivalent units in second department...Ch. 5 - Prob. 5.19SECh. 5 - Prob. 5.20SECh. 5 - Prob. 5.21SECh. 5 - Prob. 5.22SECh. 5 - Analyze flow of costs through inventory T-accounts...Ch. 5 - Summarize physical units and compute equivalent...Ch. 5 - Prob. 5.25AECh. 5 - Prob. 5.26AECh. 5 - Continuation of E5-26A: Journal entries (Learning...Ch. 5 - Complete the production cost report in first...Ch. 5 - Prob. 5.29AECh. 5 - Analyze costs and gross profit in a process...Ch. 5 - Prob. 5.31AECh. 5 - Compute equivalent units and assign costs...Ch. 5 - Complete five-step procedure in first department...Ch. 5 - Sustainability and process costing (Learning...Ch. 5 - Complete five-step procedure and journalize result...Ch. 5 - Complete five-step procedure in second department...Ch. 5 - Exercises Group B E5-37B Analyze flow of costs...Ch. 5 - Summarize physical units and compute equivalent...Ch. 5 - Prob. 5.39BECh. 5 - Complete five-step procedure in first department...Ch. 5 - Prob. 5.41BECh. 5 - Prob. 5.42BECh. 5 - Prob. 5.43BECh. 5 - Prob. 5.44BECh. 5 - Record journal entries (Learning Objective 4)...Ch. 5 - Compute equivalent units and assign costs...Ch. 5 - Prob. 5.47BECh. 5 - Sustainability and process costing (Learning...Ch. 5 - Complete five-step procedure and journalize result...Ch. 5 - Complete five-step procedure in second department...Ch. 5 - Process costing in a single processing department...Ch. 5 - Process costing in a first department (Learning...Ch. 5 - Prob. 5.53APCh. 5 - Prepare a production cost report and journal...Ch. 5 - Prob. 5.55APCh. 5 - Process costing in a single processing department...Ch. 5 - Process costing in a first department (Learning...Ch. 5 - Prob. 5.58BPCh. 5 - Prepare a production cost report and journal...Ch. 5 - Prob. 5.60BPCh. 5 - Prob. 5.61SCCh. 5 - Discussion Questions 1. What characteristics of...Ch. 5 - Prob. 5.63ACTCh. 5 - Prob. 5.64ACTCh. 5 - Process costing and hybrid costing issues...
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
- Compute departmental overhead rates (Learning Objective 1)54-4Snyder Snacks makes potato chips, corn chips, and cheese puffs using three different pro- duction lines within the same manufacturing plant . Currently, Snyder uses a single plant- wide overhead rate to allocate its $3,311,500 of annual manufacturing overhead . Of this amount, $2,070,000 is associated with the potato chip line, $763,000 is associated with the corn chip line, and $478,500 is associated with the cheese puff line. Snyder's plant is currently running a total of 17,900 machine hours: 11,500 in the potato chip line, 3,500 in the corn chip line, and 2,900 in the cheese puff line. Snyder considers machine hours to be the cost driver of manufacturing overhead costs .1. What is Snyder's plantwide overhead rate?2. Calculate the departmental overhead rates for Snyder's three production lines. Roundall answers to the nearest cent .3. Which products have been overcosted by the plantwide rate? Which products havebeen…arrow_forwardRequired information Use the following information for the Exercises below. (Algo) [The following information applies to the questions displayed below.] The first production department of Stone Incorporated reports the following for April. Direct Materials Percent Complete 75% Conversion Percent Complete 25% Beginning work in process inventory Units started this period Completed and transferred out Ending work in process inventory Units 63,000 337,000 315,000 85,000 80% 30% Exercise 16-8 (Algo) Weighted average: Computing equivalent units of production LO P1 Compute the number of equivalent units of production for both direct materials and conversion for April using the weighted average method. X Answer is complete but not entirely correct. Equivalent units of production: Weighted average method Direct Materials Conversion Units Percent Complete Percent EUP EUP Complete Units started this period 315,000 100% 315,000 100% 315,000 Ending work in process 85,000 85% 72,250 35% X 29,750 X…arrow_forwardQuestion 4 : a company, manufactures educational toys using process costing system. Plastic is molded into the appropriate shapes in the Molding Department. Molded components are transferred to the Assembly Department where the toys are assembled. Molding Beginning inventory: Units 500 Prior department Materials Conversion costs Started or transferred in: $2,500.00 $1,050.00 Units February costs: Prior department Materials 1,000 $5,000.00 Conversion costs $7,660.00 Ending inventory in units 200 Beginning and ending work in process for the department showed the following degree of completion: Molding Degree of completion: Beginning work in process, materials Beginning work in process, conversion costs Ending work in process, materials Ending work in process, conversion costs 100% 30 100 20 Required : 1. Calculate the Modeling Department's equivalent units of production for materials and conversion in July using FIFO method. 2. Summarize total costs to account for and assign total costs…arrow_forward
- Process costing: book order agency All Texts and Stationery Ltd (ATS) is a major provider of texts and stationery to secondary schools throughout South Australia. Students submit their order to ATS through their school at the beginning of the year. All Texts and Stationery fills the order in three stages: (a) An order is received from the school and entered into the ATS inventory order system. (b) The books and stationery required to fill the order are taken from inventory, packed and dispatched to the student. (c) Payment is received from the student and processed. The costs of these three processes in the year just ended are listed below: Cost Receipt of order Packing and dispatch of order Receipt of payment $ 60 000 $ 72 000 Staff salaries $150 000 Equipment depreciation 504 000 174 000 288 000 Equipment insurance 96 000 66 000 96 000 Telephone 4 800 3 600 2 400 Data processing 9 000 2 400 14 400 Postage 186 000 Consumables 3 600 42 000 2 400 During the year, ATs processed 22 000…arrow_forwardRequired information Use the following information for the Exercises below. (Algo) [The following information applies to the questions displayed below.] The first production department of Stone Incorporated reports the following for April. Direct Materials Percent Complete 75% Conversion Percent Complete 25% Units Beginning work in process inventory Units started this period Completed and transferred out Ending work in process inventory 63,000 337,000 315,000 85,000 80% 30% Exercise 16-8 (Algo) Weighted average: Computing equivalent units of production LO P1 Compute the number of equivalent units of production for both direct materials and conversion for April using the weighted average method. Equivalent units of production: Weighted average method Direct Materials Conversion Units Percent Percent EUP EUP Complete Complete Totalarrow_forwardRequired information Use the following information for the Exercises below. (Algo) Skip to question [The following information applies to the questions displayed below.]The first production department of Stone Incorporated reports the following for April. Units Direct Materials Conversion Percent Complete Percent Complete Beginning work in process inventory 82,000 70% 30% Units started this period 432,000 Completed and transferred out 410,000 Ending work in process inventory 104,000 85% 35% Exercise 3-11A (Algo) FIFO: Costs assigned to output LO C2 The production department had the cost information below. Beginning work in process inventory Direct materials $ 206,850 Conversion 35,490 $ 242,340 Costs added this period Direct materials 1,512,630 Conversion 991,230 2,503,860 Total costs to account for $ 2,746,200 (a) Calculate the costs per equivalent unit of production for both direct materials and conversion for the…arrow_forward
- Sharpe Company makes organic salsa in two production departments, Cooking and Bottling. Direct materials costs are added at the beginning of each process, and conversion costs are added evenly throughout each process. The company reports the following for a recent month. Beginning work in process inventory Activity during the month Direct materials Direct labor Overhead applied Costs transferred from Cooking to Bottling Costs transferred from Bottling to finished goods View transaction list Journal entry worksheetarrow_forwardEntries for process cost system Instructions Chart of Accounts Journal Final Questions Instructions Port Ormond Carpet Company manufactures carpets. Fiber is placed in process in the Spinning Department, where it is spun into yarn. The output of the Spinning Department is transferred to the Tufting Department, where carpet backing is added at the beginning of the process and the process is completed. On January 1, Port Ormond Carpet Company had the following inventories: Finished Goods $62,000 Work in Process-Spinning Department 35,000 Work in Process-Tufting Department 28,500 Materials 17,000 Departmental accounts are maintained for factory overhead, and both have zero balances on January 1. Manufacturing operations for January are summarized as follows: Jan. 1 Materials purchased on account, $500,000 2 Materials requisitioned for use: Fiber—Spinning Department, $275,000 Carpet backing—Tufting Department,…arrow_forwardAzule Company manufactures in two sequential processes, Cutting and Binding. The two processes r recent month. Beginning work in process inventory costs added this period Direct materials Conversion cutting $ 3,445 Transferred from cutting to Binding Transferred from Binding to finished goods Ending work in process inventory 8,240 11, 100 Cutting Binding $ 6,426 Determine the ending balances in the Work in Process Inventory accounts for Cutting and for Binding in Process Inventory for both Cutting and for Binding. tatou 6,356 18,575 Binding $ 15,685 30,000arrow_forward
- Required Information Use the following information for the Exercises below. (Algo) [The following information applies to the questions displayed below.] The first production department of Stone Incorporated reports the following for April. Direct Materials Beginning work in process inventory Units started this period Completed and transferred out Ending work in process inventory Units started and completed Units 69,000 367,000 345,000 91,000 Equivalent units of production Percent Complete 80% 80% Exercise 16-10A (Algo) FIFO: Computing equivalent units of production LO C2 Units (a) Compute the number of units started and completed this period for the first production department. Equivalent units of production: FIFO method Direct Materials Percent Added Conversion TO Percent Complete (b) Compute the number of equivalent units of production for both direct materials and conversion for the first production depar for April using the FIFO method. 20% 30% EUP Conversion Percent Added EUP A:arrow_forwardLearning Objectives 2, 3, 4 1. Total EUP for CC 2,850 3. WIP Balance $1,145 P18-31A Preparing a production cost report, two materials added at different points, no beginning WIP or costs transferred in; journal entries Smith's Exteriors produces exterior siding for homes. The Preparation Department begins with wood, which is chopped into small bits. At the end of the process, an adhesive is added. Then the wood/adhesive mixture goes on to the Compression Department, where the wood is compressed into sheets. Conversion costs are added evenly throughout the preparation process. January data for the Preparation Department are as follows: UNITS Beginning Work-in-Process Inventory Started in production Completed and transferred out to Compression in January Ending Work-in-Process inventory (30% of the way through the preparation process) COSTS Beginning Work-in-Process Inventory Costs added during January Wood Adhesives Direct labor Manufacturing overhead allocated Total costs Requirements…arrow_forwardActivity-Based Costing, Lean Operations, and the Costs of Quality E4-24A Compare traditional and ABC allocations on a job (Learning Objective 2) Radley Products has adopted an ABC costing system. The following manufacturing activi- ties, indirect manufacturing costs, and cost drivers have been identified: Activity Machine setup Total estimated MOH costs related to activity Total estimated amount of allocation base activity $ 120,000 $1,050,000 Machining Polishing Quality control Facility-level costs sdngas 000' 6,000 machine hours 10,000 polishing cloths 4,000 tests run 50,000 DL hours 000'08 $ 280,000 $ 120.000 Total manufacturing overhead (MOH) $1.650.000 The Job Cost Record for Job #624 revealed that direct materials requisitioned for the job totaled $1,050. The Job Cost Record also showed that direct labor for this job totaled 10 hours at a wage rate of 525 per hour. Other data collected on the resources used by Job #624 included: 1 machine setup required 5 machine hours 2…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Principles of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College
Cornerstones of Cost Management (Cornerstones Ser...AccountingISBN:9781305970663Author:Don R. Hansen, Maryanne M. MowenPublisher:Cengage Learning
Principles of Accounting Volume 2
Accounting
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax College
Cornerstones of Cost Management (Cornerstones Ser...
Accounting
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
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