Problem 20-1A Production cost flow and measurement; journal entries L.O. P1, P2, P3, P4

[The following information applies to the questions displayed below.]

Edison Company manufactures wool blankets and accounts for product costs using process costing. The following information is available regarding its May inventories.
 Beginning Inventory Ending Inventory 
  Raw materials inventory$60,000 $41,000 
  Goods in process inventory 449,000  521,500 
  Finished goods inventory 610,000  342,001 
The following additional information describes the company’s production activities for May.
     
  Raw materials purchases (on credit)$250,000 
  Factory payroll cost (paid in cash) 1,850,300 
  Other overhead cost (Other Accounts credited) 82,000 
  Materials used   
       Direct$200,500 
       Indirect 50,000 
  Labor used   
       Direct$1,060,300 
       Indirect 790,000 
  Overhead rate as a percent of direct labor 115%
  Sales (on credit)$3,000,000 
The predetermined overhead rate was computed at the beginning of the year as 115% of direct labor cost.

\\\\\ rev: 11_02_2011  

references

 1.

value: 2.00 points

Problem 20-1A Part 1

Required:
1(a)Compute the cost of products transferred from production to finished goods. (Omit the “$” sign in your response.)
  Cost of products transferred$   
1(b)Compute the cost of goods sold. (Omit the “$” sign in your response.)
  Cost of goods sold$   

   rev: 10_31_2011

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 2.

value: 5.00 points

Problem 20-1A Part 2

2(a)Prepare journal entry dated May 31 to record the raw materials purchases. (Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
May 31      
            
2(b)Prepare journal entry dated May 31 to record the direct materials usage. (Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
May 31      
            
2(c)Prepare journal entry dated May 31 to record the indirect materials usage. (Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
May 31      
            
2(d)Prepare journal entry dated May 31 to record the payroll costs. (Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
May 31      
            
2(e)Prepare journal entry dated May 31 to record the direct labor costs. (Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
May 31      
            
2(f)Prepare journal entry dated May 31 to record the indirect labor costs. (Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
May 31      
            
2(g)Prepare journal entry dated May 31 to record the other overhead costs. (Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
May 31      
            
2(h)Prepare journal entry dated May 31 to record the overhead applied. (Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
May 31      
            
2(i)Prepare journal entry dated May 31 to record the goods transferred from production to finished goods.(Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
May 31      
            
2(j)Prepare journal entry dated May 31 to record the sale of finished goods. (Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
May 31      
            
     
       
        
Fairfax Company uses weighted-average process costing to account for its production costs. Direct labor is added evenly throughout the process. Direct materials are added at the beginning of the process. During September, the company transferred 760,000 units of product to finished goods. At the end of September, the goods in process inventory consists of 203,000 units that are 90% complete with respect to labor. Beginning inventory had $438,165 of direct materials and $188,540 of direct labor cost. The direct labor cost added in September is $3,582,260, and the direct materials cost added is $2,932,335.

references

 3.

value: 2.00 points

Problem 20-2A Part 1

Required:
1(a)Determine the equivalent units of production with respect to direct labor.
  Equivalent units  
1(b)Determine the equivalent units of production with respect to direct materials.
  Equivalent units  

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 4.

value: 2.00 points

Problem 20-2A Part 2

2.Compute both the direct labor cost and the direct materials cost per equivalent unit. (Round your answers to 2 decimal place. Omit the “$” sign in your response.)
 Per equivalent unit
  Direct labor cost$   
  Direct materials cost$   

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 5.

value: 2.00 points

Problem 20-2A Part 3

3(a)Compute both direct labor cost and direct materials cost assigned to units completed and transferred out. (Due to rounding of cost per unit, the total costs accounted for in the cost summary may not equal to sum of all the costs given in the problem. Round your per unit costs to 2 decimal places and final answers to the nearest dollar amount.)
 Cost transferred out
  Direct materials$    
  Direct labor$    
3(b)Compute both direct labor cost and direct materials cost assigned to ending goods in process inventory. (Due to rounding of cost per unit, the total costs accounted for in the cost summary may not equal to sum of all the costs given in the problem. Round your per unit costs to 2 decimal places and final answers to the nearest dollar amount.)
 Costs of ending goods in process
  Direct materials$    
  Direct labor$    

Problem 20-3A Journalizing in process costing; equivalent units and costs L.O. C2, P1, P2, P3

[The following information applies to the questions displayed below.]

Li Company produces large quantities of a standardized product. The following information is available for its production activities for January.
        
  Raw materials     Factory overhead incurred   
  Beginning inventory$16,000   Indirect materials used$80,500    
  Raw materials purchased (on credit) 280,000   Indirect labor used 40,000    
  Direct materials used (171,500)  Other overhead costs 159,920    
      
  Indirect materials used (80,500)  Total factory overhead incurred$280,420    
   
  Ending Inventory$44,000     
     
      Factory overhead applied   
  Factory payroll         (140% of direct labor cost)   
  Direct labor used$200,300   Total factory overhead applied$280,420    
      
  Indirect labor used 40,000     
     
  Total payroll cost (paid in cash)$240,300     
     
Additional information about units and costs of production activities follows.
        
  Units    Costs    
  Beginning goods in process inventory2,600   Beginning goods in process inventory    
  Started26,000        Direct materials$3,000    
  Ending goods in process inventory4,900        Direct labor 3,500    
          Factory overhead 4,000    
      
      $10,500   
Status of ending goods in process inventory    Direct materials added   171,500   
     Materials—Percent complete90 %  Direct labor added   200,300   
     Labor and overhead—Percent complete75 %  Overhead applied (140% of direct labor)   280,420   
      
     Total costs  $662,720   
      
     Ending goods in process inventory  $92,911   
During January, 22,000 units of finished goods are sold for $160 cash each. Cost information regarding finished goods follows.
    
  Beginning finished goods inventory$150,000 
  Cost transferred in 569,809 
  Cost of goods sold (598,390)
 
  Ending finished goods inventory$121,419 
 

references

 6.

value: 5.00 points

Problem 20-3A Part 1

Required:
1(a)Prepare journal entry dated January 31 to record the purchase of raw materials. (Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
Jan. 31      
            
1(b)Prepare journal entry dated January 31 to record the direct materials usage. (Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
Jan. 31      
            
1(c)Prepare journal entry dated January 31 to record the indirect materials usage. (Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
Jan. 31      
            
1(d)Prepare journal entry dated January 31 to record the factory payroll costs. (Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
Jan. 31      
            
1(e)Prepare journal entry dated January 31 to record the direct labor costs used in production. (Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
Jan. 31      
            
1(f)Prepare journal entry dated January 31 to record the indirect labor costs. (Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
Jan. 31      
            
1(g)Prepare journal entry dated January 31 to record the other overhead costs—credit Other Accounts.(Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
Jan. 31      
            
1(h)Prepare journal entry dated January 31 to record the overhead applied. (Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
Jan. 31      
            
1(i)Prepare journal entry dated January 31 to record the goods transferred to finished goods. (Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
Jan. 31      
            
1(j)Prepare journal entries dated January 31 to record the sale of finished goods. (Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
Jan. 31      
            
      
       
            

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 7.

value: 5.00 points

Problem 20-3A Part 2

2.Prepare a process cost summary report for this company, showing costs charged to production, units cost information, equivalent units of production, cost per EUP, and its cost assignment and reconciliation. (Due to rounding of cost per unit, the total costs accounted for in the cost summary may not equal to sum of all the costs given in the problem. Round your cost per EUP answers to 2 decimal places and consider the same in the other calculations. Round other answers to the nearest dollar amount. Omit the “$” sign in your response.)
LI COMPANY
Process Cost Summary
For Month Ended January 31
Costs Charged to Production  
  Costs of beginning goods in process  
      $    
         
         
   
  $   
  Costs incurred this period  
      $    
         
         
   
    
   
  Total costs to account for $   
   
Unit cost information
Units to account for Units accounted for 
        
        
   
  Total units to account for    Total units accounted for  
   
Equivalent units of productionDirect Materials Direct LaborFactory Overhead
   EUP     EUP     EUP    
   EUP     EUP     EUP    
  
  Equivalent units of production EUP     EUP     EUP    
  
Cost per EUPDirect Materials          Direct Labor           Factory Overhead           
  $ $ $ 
        
  
  Total costs$ $ $ 
    EUP   EUP  EUP
  
  Cost per EUP$ Per EUP$ Per EUP$ Per EUP
  
Cost assignment and reconciliation
Costs transferred out  
     $    
        
        
   
  $   
  Costs of ending goods in process  
     $    
        
        
   
    
   
  Total costs to account for $   
   

roblem 20-5A Process cost summary, equivalent units, cost estimates L.O. C2, C3, P4

[The following information applies to the questions displayed below.]  

Ogden Co. manufactures a single product in one department. All direct materials are added at the beginning of the manufacturing process. Direct labor and overhead are added evenly throughout the process. The company uses monthly reporting periods for its weighted-average process cost accounting. During October, the company completed and transferred 24,600 units of product to finished goods inventory. Its 4,200 units of beginning goods in process consisted of $20,800 of direct materials, $203,300 of direct labor, and $100,040 of factory overhead. It has 3,000 units (100% complete with respect to direct materials and 90% complete with respect to direct labor and overhead) in process at month-end. After entries to record direct materials, direct labor, and overhead for October, the company’s Goods in Process Inventory account follows.
 Goods in Process Inventory  Acct. No.133
DateExplanationDebitCreditBalance
Oct.  1     Balance  324,140  
31     Direct materials504,900   829,040  
31     Direct labor1,224,300   2,053,340  
31     Applied overhead963,840   3,017,180  

references

 8.

value: 5.00 points

Problem 20-5A Part 1

1.Prepare the company’s process cost summary for October using the weighted-average method. (Due to rounding of cost per unit, the total costs accounted for in the cost summary may not equal to sum of all the costs given in the problem. Round your cost per EUP answers to 2 decimal places and consider the same in the other calculations. Round other answers to the nearest dollar amount. Omit the “$” sign in your response.)
OGDEN CO.
Process Cost Summary
For Month Ended October 31
Costs Charged to Production  
  Costs of beginning goods in process  
      $    
         
         
   
  $   
  Costs incurred this period  
      $    
         
         
   
    
   
  Total costs to account for $   
   
Unit cost information
Units to account for Units accounted for 
        
        
   
  Total units to account for    Total units accounted for  
   
Equivalent units of productionDirect Materials Direct LaborFactory Overhead
   EUP     EUP     EUP    
      EUP     EUP     EUP    
  
  Equivalent units of production EUP     EUP     EUP    
  
Cost per EUPDirect Materials     Direct Labor     Factory Overhead     
  $               $               $               
                                            
  
  Total costs$               $               $               
    EUP        EUP        EUP      
  
  Cost per EUP$  per EUP$  per EUP$  per EUP
  
Cost assignment and reconciliation
Costs transferred out  
     $    
        
        
   
  $   
  Costs of ending goods in process  
     $    
        
        
   
    
     
  Total costs to account for $   
   

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 9.

value: 2.00 points

Problem 20-5A Part 2

2.Prepare the journal entry dated October 31 to transfer the cost of completed units to finished goods inventory. (Omit the “$” sign in your response.)
DateGeneral JournalDebitCredit
Oct. 31     
           

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Problem 20-1A Production cost flow and measurement; journal entries L.O. P1, P2, P3, P4
Total:
$8.99