Preparing a cost of production report when there are lost units. The second producing department of the South Boston Company 1s the Cleaning Room. The average cost method is used to price its beginning work in process inventory. The cost of lost units is absorbed by the remaining good units.

The Work in Process—Cleaning Room account is shown below.

The monthly production report for December is as follows:

Instructions 1. Prepare the equivalent production computations for the Cleaning Room for December 19X5.
2. Prepare the cost of production report for the Cleaning Room for December 19X5.
-(Do not show a separate entry for lost units.)

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DATE 19 X5 Work in Process-Cleaning Room No. 124 DR. EXPLANATION POST. REF. DEBIT CREDIT BALANCE CR. Dec. 1 Balance 13,655 00 Dr. 31 Materials MR10 10,212 50 23,867 50 Dr. 31 Labor J10-26 28,000 00 51,867 50 Dr. 31 Overhead J10-27 13,440 00 65,307 50 Dr. 31 From Machine Shop J10-28 83,406 00 154,407 50 Dr. The balance of this account on December 1, 19X5, consists of the following costs: Costs in Prior Department $10,020.00 Costs in Current Department Materials 1,785.00 Labor 1,250.00 Overhead 600.00 Total $13,655.00