ACCT 215 Problems Solutions, Fall 2011

Chapter 4 Exercise 4-6 (15 minutes) Weighted-Average Method 1. Materials Labor Overhead Units transferred to the next department........................................ 790,000 790,000 790,000 Work in process, ending: Materials: 50,000 units × 60% complete........ 30,000 Labor and overhead: 50,000 units × 20% complete........ 10,000 10,000 Equivalent units of production........... 820,000 800,000 800,000 2. Materials Labor Overhead Cost of beginning work in process. $ 68,600 $ 30,000 $ 48,000 Cost added during the period......... 907,200 370,000 592,000 Total cost (a)...................................... $975,800 $400,00 0 $640,000 Equivalent units of production (b).. 820,000 800,000 800,000 Cost per equivalent unit (a) ÷ (b)..... $1.19 $0.50 $0.80 4-1 Exercise 4-7 (30 minutes) Weighted-Average Method 1. Equivalent units of production Pulping Conversio n Transferred to next department....................... 146,000 146,000 Ending work in process: Pulping: 6,000 units x 100% complete.......... 6,000 Conversion: 6,000 units x 75% complete...... 4,500 Equivalent units of production......................... 152,000 150,500 2. Cost per equivalent unit Pulping Conversio n Cost of beginning work in process............... $  1,500 $     400 Cost added during the period....................... 59,300 22,100 Total cost (a)..................................................... $60,800 $22,500 Equivalent units of production (b)................ 152,000 150,500 Cost per equivalent unit, (a) ÷ (b).................. $0.40 $0.1495 3. Cost of ending work in process inventory and units transferred out Pulping Conversio n Total Ending work in process inventory: Equivalent units of production 6,000 4,500 Cost per equivalent unit.......... $0.40 $0.1495 Cost of ending work in process inventory................... $2,400 $673 $3,073 Units completed and transferred out: Units transferred to the next department............................. 146,000 146,000 Cost per equivalent unit.......... $0.40 $0.1495 Cost of units completed and transferred out....................... $58,400 $21,827 $80,227 4. Cost reconciliation Costs to be accounted for: 4-2 Cost of beginning work in process inventory ($1,500 + $400).............................................. $ 1,900 Costs added to production during the period ($59,300 + $22,100)....................................... 81,400 Total cost to be accounted for....................... $83,300 Costs accounted for as follows: Cost of ending work in process inventory... $ 3,073 Cost of units completed and transferred out................................................................... 80,227 Total cost accounted for................................. $83,300 4-3 Exercise 4-8 (10 minutes) Work in Process—Mixing 330,000 Raw Materials Inventory 330,000 Work in Process—Mixing 260,000 Work in Process—Baking 120,000 Wages Payable 380,000 Work in Process—Mixing 190,000 Work in Process—Baking 90,000 Manufacturing Overhead 280,000 Work in Process—Baking 760,000 Work in Process—Mixing 760,000 Finished Goods 980,000 Work in Process—Baking 980,000 4-4 Problem 4-14 (45 minutes) Weighted-Average Method 1. Equivalent Units of Production Material s Conversio n Transferred to next department....................... 450,000 450,000 Ending work in process: Materials: 80,000 units x 75% complete........ 60,000 Conversion: 80,000 units x 25% complete.... 20,00 0 Equivalent units of production......................... 510,000 470,000 2. Cost per Equivalent Unit Materials Conversio n Cost of beginning work in process............... $ 36,550 $ 13,500 Cost added during the period....................... 391,850 287,300 Total cost (a)..................................................... $428,400 $300,800 Equivalent units of production (b)................ 510,000 470,000 Cost per equivalent unit, (a) ÷ (b).................. $0.84 $0.64 3. Applying Costs to Units Materials Conversio n Total Ending work in process inventory: Equivalent units of production .............................................. 60,000 20,000 Cost per equivalent unit...... $0.84 $0.64 Cost of ending work in process inventory............... $50,400 $12,800 $63,200 Units completed and transferred out: Units transferred to the next department......................... 450,000 450,000 Cost per equivalent unit...... $0.84 $0.64 Cost of units completed and transferred out................... $378,000 $288,000 $666,000 4-5 Problem 4-14 (continued) 4 . Cost Reconciliation Costs to be accounted for: Cost of beginning work in process inventory ($36,550 + $13,500)....................................... $ 50,050 Costs added to production during the period ($391,850 + $287,300).................................. 679,150 Total cost to be accounted for....................... $729,200 Costs accounted for as follows: Cost of ending work in process inventory... $ 63,200 Cost of units completed and transferred out................................................................... 666,000 Total cost accounted for................................. $729,200 Problem 4-15 (45 minutes) Weighted-Average Method 1. Equivalent units of production Material s Conversio n Transferred to next department*..................... 270,000 270,000 Ending work in process: Materials: 45,000 units x 100% complete..... 45,000 Conversion: 45,000 units x 60% complete.... 27,000 Equivalent units of production......................... 315,000 297,000 *Units transferred to the next department = Units in beginning work in process + Units started into production − Units in ending work in process = 35,000 + 280,000 45,000 = 270,000 − 2. Cost per equivalent unit Materials Conversio n Cost of beginning work in process............... $  43,400 $   20,300 Cost added during the period....................... 397,600 187,600 4-6 Total cost (a)..................................................... $441,000 $207,900 Equivalent units of production (b)................ 315,000 297,000 Cost per equivalent unit, (a) ÷ (b).................. $1.40 $0.70 3. Cost of ending work in process inventory and units transferred out Materials Conversio n Total 4-7 Ending work in process inventory: Equivalent units of production 45,000 27,000 Cost per equivalent unit.......... $1.40 $0.70 Cost of ending work in process inventory................... $63,000 $18,900 $81,900 Units completed and transferred out: Units transferred to the next department............................. 270,000 270,000 Cost per equivalent unit.......... $1.40 $0.70 Cost of units completed and transferred out....................... $378,000 $189,000 $567,000 4-8 Problem 4-16 (45 minutes) Weighted-Average Method 1. a. Work in Process—Blending 147,600 Work in Process—Bottling 45,000 Raw Materials 192,600 b. Work in Process—Blending 73,200 Work in Process—Bottling 17,000 Salaries and Wages Payable 90,200 c. Manufacturing Overhead 596,000 Accounts Payable 596,000 d. Work in Process—Blending 481,000 Manufacturing Overhead 481,000 Work in Process—Bottling 108,000 Manufacturing Overhead 108,000 e. Work in Process—Bottling 722,000 Work in Process—Blending 722,000 f. Finished Goods 920,000 Work in Process—Bottling 920,000 g. Accounts Receivable 1,400,000 Sales 1,400,000 Cost of Goods Sold 890,000 Finished Goods 890,000 4-9 Problem 4-16 (continued) 2. Accounts Receivable Raw Materials (g) 1,400,000 Bal. 198,600 (a) 192,600 Bal. 6,000 Work in Process Blending Department Work in Process Bottling Department Bal. 32,800 (e) 722,000 Bal. 49,000 (f) 920,000 (a) 147,600 (a) 45,000 (b) 73,200 (b) 17,000 (d) 481,000 (d) 108,000 Bal. 12,600 (e) 722,000 Bal. 21,000 Finished Goods Manufacturing Overhead Bal. 20,000 (g) 890,000 (c) 596,000 (d) 589,000 (f) 920,000 Bal. 7,000 Bal. 50,000 Accounts Payable Salaries and Wages Payable (c) 596,000 (b) 90,200 Sales Cost of Goods Sold (g) 1,400,000 (g) 890,000 Problem 4-17 (60 minutes) Weighted-Average Method 1. Computation of equivalent units in ending inventory: Mixing Materials Conversion Units transferred to the next department..... 60.0 60.0 60.0 Ending work in process: Mixing: 1 unit × 100% complete................ 1.0 Materials: 1 unit × 20% complete.............. 0.2 Conversion: 1 unit × 10% complete........... 0.1 4-10 Equivalent units of production........................ 61.0 60.2 60.1 2. Costs per equivalent unit: Mixing Materials Conversion Cost of beginning work in process inventory $ 1,640 $    26 $    105 Cost added during the period......................... 94,740 8,402 61,197 Total cost............................................................ $96,380 $8,428 $61,302 Equivalent units of production........................ 61.0 60.2 60.1 Cost per equivalent unit................................... $1,580 $140 $1,020 4-11 Problem 4-17 (continued) 3. Costs of ending work in process inventory and units transferred out: Mixing Materials Conversion Ending work in process inventory: Equivalent units of production.................. 1.0 0.2 0.1 Cost per equivalent unit............................. $1,580 $140 $1,020 Cost of ending work in process inventory $1,580 $28 $102 Units completed and transferred out: Units transferred to the next department 60.0 60.0 60.0 Cost per equivalent unit............................. $1,580 $140 $1,020 Cost of units transferred out...................... $94,800 $8,400 $61,200 4. Cost reconciliation: Cost to be accounted for: Cost of beginning work in process inventory ($1,640 + $26 + $105)................................... $   1,771 Cost added to production during the period ($94,740 + $8,402 + $61,197)....................... 164,339 Total cost to be accounted for....................... $166,110 Costs accounted for as follows: Cost of ending work in process inventory... $   1,710 Cost of units transferred out......................... 164,400 Total cost accounted for................................. $166,110 4-12