HomeStyle Soup Co. uses a process cost system to record the costs of processing soup, which requires the cooking and filling processes. Materials are entered from the cooking process at the beginning of the filling process. The inventory of Work in Process—Filling on February 1 and debits to the account during February 2012 were as follows:
During February, 400 units in process on February 1 were completed, and of the 8,900 units entering the department, all were completed except 650 units that were 90% completed.
Charges to Work in Process—Filling for March were as follows:
| From Cooking Department, 9,600 units |
$38,400 |
| Direct labor |
10,890 |
| Factory overhead |
5,922 |
During March, the units in process at the beginning of the month were completed, and of the 9,600 units entering the department, all were completed except 500 units that were 35% completed.
Instructions
- 1. Enter the balance as of February 1, 2012, in a four-column account for Work in Process—Filling. Record the debits and the credits in the account for February. Construct a cost of production report, and present computations for determining (a) equivalent units of production for materials and conversion, (b) costs per equivalent unit, (c) cost of goods finished, differentiating between units started in the prior period and units started and finished in February, and (d) work in process inventory.
- 2. Provide the same information for March by recording the March transactions in the four-column work in process account. Construct a cost of production report, and present the March computations (a through d) listed in part (1).
- 3.Comment on the change in costs per equivalent unit for January through March for direct materials and conversion costs.
HomeStyle Soup Co. uses a process cost system to record the costs of processing soup, which requires the cooking and filling processes. Materials are entered from the cooking process at the beginning of the filling process. The inventory of Work in Process-Filling on February 1 and debits to the account during February 2012 were as follows:
During February, 400 units in process on February 1 were completed, and of the 8,900 units entering the department, all were completed except 650 units that were 90% completed.
Charges to Work in Process-Filling for March were as follows:
| From Cooking Department, 9,600 units |
$38,400 |
| Direct labor |
10,890 |
| Factory overhead |
5,922 |
During March, the units in process at the beginning of the month were completed, and of the 9,600 units entering the department, all were completed except 500 units that were 35% completed.
Instructions
- 1. Enter the balance as of February 1, 2012, in a four-column account for Work in Process-Filling. Record the debits and the credits in the account for February. Construct a cost of production report, and present computations for determining (a) equivalent units of production for materials and conversion, (b) costs per equivalent unit, (c) cost of goods finished, differentiating between units started in the prior period and units started and finished in February, and (d) work in process inventory.
- 2. Provide the same information for March by recording the March transactions in the four-column work in process account. Construct a cost of production report, and present the March computations (a through d) listed in part (1).
- 3.Comment on the change in costs per equivalent unit for January through March for direct materials and conversion costs.