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Question 1 Process Costing Systems [20 Marks] Sydney Inc uses a process costing system. A unit of product passes through three departmentsMoulding, Assembly and Finishingbefore it is completed. The following production took place in the Finishing Department during August: Units Work in process inventory, 1 August 1 400 Units transferred in 'om Assembly Department 14 000 Units transferred out to nished goods inventory 11 900 Raw material is added at the beginning of processing in the Finishing Department. The work in process inventory was 70 per cent complete as to conversion on 1 August, and 40 per cent complete as to conversion on 31 August. Sydney Inc uses the weighted average method of process costing. The equivalent units and costs per equivalent unit of production for each cost element for the Finishing Department are shown as follows: Eg uivalent units Cost per eg uivalent unit Transferred-in costs 15 400 $5.00 Raw material 15 400 1.00 Conversion cost 13 300 M Total $9.00 Required: 1. Calculate the following amounts: [10 Marks] (a) Cost of units transferred to nished goods inventory during August. (b) Cost of the Finishing Department's work in process inventory on 31 August. 2. The total costs of prior departments included in the work in process inventory of the Finishing Department on 1 August amounted to $6750. Prepare the journal entry to record the transfer of the goods from the Assembly Department to the Finishing Department during August. [10 Marks]