Cost Flows Lamont Company produced 80,000 machine parts for diesel engines. There were no beginning or ending work-in-process inventories in any department. Lamont incurred the following costs for May: Molding Department Direct materials Grinding Department $5,400 8,500 14,000 $12,000 10,000 17,000 Finishing Department $8,000 12,000 11,000 Direct labor Applied overhead Required: 1. Calculate the costs transferred out of each department. Costs Transferred Out Molding 39,000 Grinding 66,900 Finishing 97,900 Feedback Check My Work In process costing, each process (department) accumulates costs in a WIP account. Remember that each WIP account include costs transferred in from other processes (departments). 2. Prepare the journal entries corresponding to these transfers. Also, prepare the journal entry for Grinding that reflects the costs added to the transferred-in goods received from Molding. For a compound transaction, if an amount box doe not require an entry, leave it blank. Transfer entries: Work in Process-Grinding 39,000 Work in Process-Molding 39,000 Work in Process-Finishing 66,900 Work in Process-Grinding 66,900 Finished Goods 97,900 LALUIR 2. Prepare the journal entries corresponding to these transfers. Also, prepare the journal entry for Grinding that reflects the costs added to the transferred-in goods received from Molding. For a compound transaction, if an amount box doe not require an entry, leave it blank. Transfer entries: 39,000 Work in Process-Grinding Work in Process-Molding 39,000 Work in Process-Finishing 66,900 Work in Process-Grinding 66,900 Finished Goods 97,900 Work in Process-Finishing 97,900 Cost-added entry (Grinding only): Work in Process-Grinding 27,900 0 Materials o 5,400 Payroll o 8,500 Overhead Control o 14,000 Feedback Check My Work As the work is finished in a process (department), the partially completed units and all their associated costs are transferred to the next process (department) by debiting the WIP account of the process (department) receiving the units ar crediting the WIP account of the transferring process (department). 3. What if the Grinding Department had an ending WIP of $12,000? Calculate the cost transferred out. $ Feedback Check My Work Costs transferred out would be the difference between total costs and the amount of ending WIP. 3. What if the Grinding Department had an ending WIP of $12,000? Calculate the cost transferred out. Feedback Check My Work Costs transferred out would be the difference between total costs and the amount of ending WIP. Provide the journal entry that would reflect this transfer. Work in Process-Finishing 56,200 X Work in Process-Grinding Feedback Check My Work Costs transferred out would be the difference between total costs and the amount of ending WIP. What is the effect on finished goods calculated in Requirement 1, assuming the other two departments have no ending WIP? Decreased by $ 12,000 Feedback Check My Work Assuming the other two processes (departments) have no ending WIP, the effect is the balance of ending WIP for the final process (department). Feedback Check My Work Partially correct