Managerial Accounting (5th Edition)
5th Edition
ISBN: 9780134128528
Author: Karen W. Braun, Wendy M. Tietz
Publisher: PEARSON
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Textbook Question
Chapter 5, Problem 5.37BE
Exercises Group B
E5-37B Analyze flow of costs through inventory T-accounts (Learning Objective 1)
Early Start Bakery mass-produces bread using three sequential processing departments: Mixing, Baking, and Packaging. The following transactions occurred during February:
| 1. Direct materials used in the Packaging Department | $ 30,000 |
| 2. Costs assigned to units completed and transferred out of Mixing | $228,000 |
| 3. Direct labor incurred in the Mixing Department | $ 11,200 |
| 4. Beginning balance: Work in Process Inventory—Baking | $ 15,900 |
| 5. Manufactured |
$ 70,000 |
| 6. Beginning balance: Finished Goods Inventory | $ 4,900 |
| 7. Costs assigned to units completed and transferred out of Baking | $301,000 |
| 8. Beginning balance: Work in Process Inventory—Mixing | $ 12,100 |
| 9. Direct labor incurred in the Packaging Department | $ 8,800 |
| 10. Manufacturing overhead allocated to the Mixing Department | $ 67,000 |
| 11. Direct materials used in the Mixing Department | $151,000 |
| 12. Beginning balance: Raw Materials Inventory | $ 23,500 |
| 13. Costs assigned to units completed and transferred out of Packaging | $380,000 |
| 14. Beginning balance: Work in Process Inventory—Packaging | $ 8,200 |
| 15. Purchases of Raw Materials | $177,000 |
| 16. Direct labor incurred in the Baking Department | $ 4,600 |
| 17. Manufacturing overhead allocated to the Packaging Department | $ 46,000 |
| 18. Cost of goods sold | $381,000 |
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 3,375,000 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)?
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Question 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…
Preparation of Process Accounts
(With opening and Closing WIP)
Practice Problem 10
A company follows process costing and manufactures a product in one process.
The work-in-progress at the end of each month is valued according to FIFO
method. At the beginning of the month of January, the inventory of work-in-
progress showed the 400 units, 40% completed, valued at RO 8000.
In the month of January, 2600 units amounting to RO 68,500 were introduced into
the process. Wages and overheads amounted to RO 79,200 and RO 21,120
respectively. Finished production taken into stock in the month was 2,500 units.
At the end of the month, the work-in-progress inventory was 500 units, 80%
complete as regards materials and 60% complete as regards labour and overhead.
You are required to compute equivalent production and prepare process account.
Work in process inventory, May 1
Work in process inventory, May 31
Materials cost in work in process inventory, May 1
Conversion cost in work in process inventory, May 1
Units started into production
Units transferred to the next production department
Materials cost added during May
Conversion cost added during May
100%
100%
30%
20%
$56,700
$ 16,800
260,600
280,600
$125,680
$ 242,012
71,000
51,000
Required:
1. Calculate the first production department's equivalent units of production for materials and conversion for May
2. Compute the first production department's cost per equivalent unit for materials and conversion for May
3. Compute the first production department's cost of ending work in process inventory for materials, conversion, and in total for May
4. Compute the first production department's cost of the units transferred to the next production department for materials, conversion,
and in total for May.
Complete this question by entering your answers in the tabs below.
Required…
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...
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