Chapter 18: Q.18-12RQ (page 1006)
Question: If a company began the month with 50 units in process, started another 600 units during the month, and ended the month with 75 units in process, how many units were completed?
Answer:
The number of units completed during the year is 575 units.
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Question: The Finishing Department of Lee and Lewis, Inc., the last department in the manufacturing process, incurred production costs of \(220,000 during the month of June.If the June 1 balance in Work-in-Process Inventory—Finishing is \)0 and the June 30balance is $70,000, what amount was transferred to Finished Goods Inventory?
Question: Department 4 has completed production on units that have a total cost of $15,000. The units are ready for sale. Give the journal entry.
Question: Spring Fresh produces premium bottled water. Spring Fresh purchases artesian water, stores the water in large tanks, and then runs the water through two processes: filtration and bottling.
During February, the filtration process incurred the following costs in processing
200,000 liters:
Wages of workers operating filtration equipment | $34,950 |
Manufacturing overhead allocated to filtration | 19,050 |
Water | 110,000 |
Spring Fresh had no beginning Work-in-Process Inventory in the Filtration Department in February.
Requirements
1. Use the FIFO method to compute the February conversion costs in the Filtration Department.
2. The Filtration Department completely processed 200,000 liters in February. Use
the FIFO method to determine the filtration cost per liter.
Shea Winery in Pleasant Valley, New York, has two departments: Fermenting and Packaging. Direct materials are added at the beginning of the fermenting process (grapes) and at the end of the packaging process (bottles). Conversion costs are added evenly throughout each process. The company uses the weighted-average method. Data from the month of March for the Fermenting Department are as follows:
Gallons | |
Beginning work-in-process inventory | 500 gallons |
Started in production | 8,600 gallon |
Completed and transferred out to packaging in march | 7,900 gallon |
Ending work-in-process inventory (80% of the way through the blending process) | 1,200 gallon |
Costs | |
Beginning work-in-process inventory | |
| \(540 |
| 195 |
| 210 |
Cost added during march | |
| 9,288 |
| 3,305 |
| 3,378 |
Total cost added during march | \)15,971 |
Requirements
1. Compute the Fermenting Department’s equivalent units of production for direct
materials and for conversion costs.
2. Compute the total costs of the units (gallons)
a. completed and transferred out to the Packaging Department.
b. in the Fermenting Department ending Work-in-Process Inventory.
Question: What types of companies use process costing systems?
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