Transferred-in costs, weighted average (related to 17-30 to 17-32). (Chapter Appendix I)

Global Defence, Inc., as you know, manufactures the Interceptor missile at its Halifax plant. It has two departments—Assembly Department and Testing Department. This problem focuses on the Testing Department. (Problems 17-30 to 17-32 focused on the Assembly Department.)

Direct materials are added at the end of the Testing Department. Conversion costs are added evenly during the Testing Department’s process. As work in Assembly is completed, each unit is immediately transferred to Testing. As each unit is completed in Testing, it is immediately transferred to Finished Goods.

Global Defence uses the weighted-average method of process costing. Data for the Testing Department for October 2007 are Physical Units Transferred-in Direct Conversion

(Missiles) Costs Materials Costs Work in process, October 1* 35 Transferred in during October 2007 ?

Completed during October 2007 110 Work in process, October 3 E 20 Costs added during October 2007

$1,084,380 $ 0 $ 364,980

$3,382,000 $3,885,000 $1,581,000

‘Degree of completion: transferred-in costs, ?%; direct materials, ?%; conversion costs, 70%.

fDegree of completion: transferred-in costs, ?%; direct materials, ?%; conversion costs, 60%.

Required 1. What is the percentage of completion for

(a) transferred-in costs and direct materials in beginning work-in-process inventory and

(b) transferred-in costs and direct materials in ending work-in-process inventory?

2. For each cost element, compute equivalent units of work done in October 2006 in the Testing Department. $how physical units in the first column.

3. For each cost element, calculate the cost per equivalent unit of beginning work in process CHAPTER and ofwork done in October 2007.

4. Summarize total Testing Department costs for October 2007, and assign these costs to units completed (and transferred out) and to units in ending work in process using the weighted-average method.
5. Prepare journal entries for October transfers from the Assembly Department to the Testing Department and from Testing to Finished Goods.