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14. Benson Pharmaceuticals uses a process-costing system to compute the unit costs of the over-the-counter cold remedies that it produces. It has three departments: Iinxing,

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14. Benson Pharmaceuticals uses a process-costing system to compute the unit costs of the over-the-counter cold remedies that it produces. It has three departments: Iinxing, Encapsulating, and Bottling. In l'inxing, the ingredients for the cold capsules are measured, sifted, and blended (materials are thus assumed to be uniformly added throughout the process). The mix is transferred out in gallon containers. The encapsulating department takes the powdered mix and places it in capsules (capsules are necessarily added at the beginning of the process). One gallon of powdered mix converts into capsules. After the capsules are lled and polished, they are transferred to Bottling, where they are placed in bottles that are then afxed with a safety seal, lid, and label. Each bottle receives capsules. During March, the following results are available for the first two departments: Mixing Ehrepnulaling Beginning inventories: Physical units It] gallons 4,010 Costs: Materials $252 $32 Labor 5282 $20 Overhead '3 '3 Transferred in 5140 Current production: Transferred out 140 gallons 2113,00] Ending inventory 20 gallons 6.1200 Costs: Materials $3.636 $1.518 Transferred in '3 Labor $4.618 $1.944 Overhead 'l' '2' Percentage of completion: Beginning inventory 40% 50% Ending inventory 50% 40% Overhead in both departments is applied as a percentage of direct labor costs. In the mixing department, overhead is 200% of direct labor. In the encapsulating department, the overhead rate is 150% of direct labor. Regnired: A. Prepare a production report for the mixing department and the encapsulating department using the weighted average method. (Note: Round to two decimal places for the unit cost.) B. Prepare a production report for the mixing department and the encapsulating department using the FIFO method. (Note: Round to two decimal places for the unit cost.)

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