Performance Castings Inc. casts blades for turbine engines. Within the Casting Department, alloy is first melted in a crucible, then poured into molds to produce the castings. On December 1, there were 800 pounds of alloy in process, which were 60% complete as to conversion. The Work in Process balance for these 800 pounds was $111,680, determined as follows:
Direct materials (800 x $130) $104,000
Conversion (800 x 60% x $16) 7,680
$111,680
During December, the Casting Department was charged $945,000 for 7,500 pounds of alloy and $45,072 for direct labor. Factory overhead is applied to the department at a rate of 150% of direct labor. The department transferred out 7,750 pounds of finished castings to the Machining Department. The December 31 inventory in process was 44% complete as to conversion.
a. Prepare the following December journal entries for the Casting Department:
1. The materials charged to production.
2. The conversion costs charged to production.
3. The completed production transferred to the Machining Department.
b. Determine the Work in Process Casting Department December 31 balance.