DIRECT MATERIALS ADDED IN SUBSEQUENT DEPARTMENT-INCREASE IN UNITS The Aroma Perfume Co. has two processing departments Direct materials are added at the beginning of the process in both departments. Below is the cost of production report for February for Department 1: CODUCT COSTING 3,000 QUANTITIES Units to account for: Units started in process Units accounted for Units transferred to next department 6,000 Ending units in process 2.000 5.000 EQUIVALENT PRODUCTION DIRECT MATERIALS 6,000 CONVERSION COSTS 6,000 Units transferred to Department 2 Ending units in process: 2,000 X 100 2,000 30% Total equivalent units 2.000 600 6,600 8,000 COSTS TO ACCOUNT FOR EQUIVALENT TOTAL COST - PRODUCTION EQUIVALENT UNIT COST Costs added by department: Direct materials Direct labor Factory overhead Total costs to account for $ 8,400 4.950 3,960 517310 8.000 6,600 6,600 $1.05 .75 60 $2.40 $14.400 COSTS ACCOUNTED FOR Transferred to next department (6,000 x 5240) Work-in-process inventory-ending: Direct materials (2,000 $1.05) $2,100 Direct labor (2.000 x 30 x 5.75) 450 Factory overhead (2.000 * 30 * 5.60) 360 Total costs accounted for 2,910 $17,310 3,000 8,100 Data for Department 2 for February Units added to production Units transferred to finished goods Costs added by the department: Direct materials Direct labor Factory overhead 56,660 5,046 3,654 Ending units in process are complete as to conversion costs. No beginning work-in- process inventory exists. Required: Prepare a cost of production report for Department 2. b Give the journal entries to record February's activity in both departments