Question

Work Problem P18-33A using the FIFO method. The Mixing Department beginning work in process of 300 units is 40% complete as to both direct materials and conversion costs. Round equivalent unit of production costs to four decimal places. Round all other costs to the nearest whole dollar.

Short answer

1. Production cost report

Production Cost Report-Mixing Department
		Equivalent unit of production
UNITS	Physical units	Direct material	Conversion costs	Total
Units to account for:
Beginning WIP	300
Started in production	4,700
Total units to account for	5,000
Units accounted for:
Completed and transferred	4,500	4,380	4,380
Ending WIP	500	100	100
Total units accounted for	5,000	4,480	4,480
COSTS		Direct material	Conversion costs	Total costs
Costs to account for:
Beginning WIP		$350	$445	$795
Cost added during the period		4,940	6,225	11,165
Total cost to account for		5,290	6,670	11,960
Divided by: total EUP		4,480	4,480
Cost per equivalent unit		$1.18	$1.49
Costs accounted for:
- Completed and transferred out		5,172 (4,380 x $1.18)	6,521 (4,380x$1.49)	11,693
- Ending WIP		118 (100x $1.18)	149 (100x$1.49)	267
Total costs accounted for		5,290	6,670	11,960

2. The journal entries to show the transaction affecting the mixing department are shown in step 4.

Step-by-step solution

Step-by-Step Solution:Step 1: Production Cost Report

A production cost report is a report prepared by a company that has several manufacturing processes, and this report shows the various kinds of costs of the product.

Equivalent unit of production for direct material cost

Particulars	EUP
Opening WIP (300 x 60%)	180
Completed and transferred (4,500 – 300) x 100%	4,200
Ending WIP (500 x 20%)	100
Total EUP	4,480

Equivalent unit of production for conversion costs

Particulars	EUP
Opening WIP (300 x 60%)	180
Completed and transferred (4,500 – 300) x 100%	4,200
Ending WIP (500 x 20%)	100
Total EUP	4,480

Journal Entries

Date	Particulars	Debit ($)	Credit ($)
1.	WIP Inventory-Mixing department	4,940
	Raw material		4,940
2.	WIP inventory-Mixing department	3,000
	Wages payable		3,000
3.	WIP inventory – mixing department	3,225
	Manufacturing overhead		3,225
4.	WIP inventory-cooking department	11,693
	WIP inventory – mixing department		11,693