Chapter 20 Homework Equivalent Units and Related Costs; Cost of Production Report; Entries Dover Chemical Company manufactures specialty chemicals by a series of three processes, all materials being introduced in the Distilling Department. From the Distilling Department, the materials pass through the Reaction and Filling departments, emerging as finished chemicals The balance in the account Work in Process-Filling was as follows on January 1: Work in Process-Filing Department (3.600 units, on completed): Direct materials (3,600 x 5:3.60) $66,960 Conversion (3,600 X 60% * $12.10) 26,136 193,096 The following costs were charged to Work in Process-Filling during January: Direct materials transferred from Reaction Department: 46,400 units at $18.40 unit 5853,760 Direct labor 285,050 Factory overhead 273,062 During January, 46,000 units of specialty chemicals were completed. Work in Process- Filling Department on January 31 was 4,000 units, 40% completed. Required: 1. Prepare a cost of production report for the Filling Department for January. If an amount is zero, enter "o". If required, round your cost per equivalent unit answers to two decimal places. Dover Chemical Company Cost of Production Report-Filing Department For the Month Ended January 31 Unit Information Units charged to production: Inventory in process, January Received from Reaction Department Total units accounted for by the Fring Department Units to be assigned costs: Equivalent Units Whole Direct Units Materials Conversion Inventory in process, January Started and completed in January Transferred to the goods in January Inventory in process, ay 31 Total units to be assigned costs Chapter 20 Homework Feedback 2. Journalize the entries for (1) costs transferred from Reaction to Filling and (2) the costs transferred from Filling to Finished Goods. (1) Work in Process-Filing Department Work in Process-Reaction Department 0 (2) Finished Goods Work in Process-Filling Department Feedback Check yo 2. Remember that there are three types of inventory; materials, work in process, and finished goods. What costs are captured in the work in process account? Are these units 100% complete or are they being transferred to another department? Amount Increase 3. Determine the increase or decrease in the cost per equivalent unit from December to January for direct materials and conversion costs. If required, round your answers to two decimal places. Increase or decrease Change in direct materials cost per equivalent unit Decrease Change in conversion cost per equivalent unit 4. The cost of production report may be used as the basis for allocating product costs between Work in Process and Finished Goods . The report can also be used to control costs by holding each department head responsible for the units entering production and the costs incurred in the department. Any differences in unit product costs from one month to another, such as those in part (3), can be studied carefully and any significant differences investigated. Feedback Check My Wern 3. and 4. Compare the costs per equivalent unit for December and January. Review the benefits of the cost of production report