Pure Spring Company produces premium bottled water. In the second department, the Bottling Department, conversion costs are incurred evenly throughout the bottling process, but packaging materials are not added until the end of the process. Costs in beginning Work-in-Process Inventory include transferred in costs of $1,500, direct labor of $500, and manufacturing overhead of $430. February data for the Bottling Department follow:

Requirements
1. Prepare a production cost report for the Bottling Department for the month of February.
2. Prepare the journal entry to record the cost of units completed and transferred out.
3. Post all transactions to the Work-in-Process Inventory€”Bottling T-account. What is the ending balance?

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PURE SPRING COMPANY Work-in-Process Inventory-Bottling Month Ended February 29, 2016 Dollars Transferred ct Direct Mufacturing Units In Materials Labor Overhead Total Costs Beginning inventory Feb. 1(40% complete) Production started Transferred out Ending inventory, Feb. 29 (70% complete) S 2,430 222,270 $ 4,000 166,000 132,800 33,000 33,200 23,270 150,000 1,500 $ 500 $430 20,000