Excel Assignment # 3

Spring

Because most of the parts for its irrigation systems are standard, Northern Illinois Manufacturing handles the majority of its manufacturing as a process cost system. There are multiple process departments. Three of these departments are the Molding, Cutting, and the Welding departments. All items eventually end up in the Package department which prepares items for sale in kits or individually.

The following information is available for the Molding department for January:

Work in process beginning:

Units in process

22,500

Stage of completion for materials

80%

Stage of completion for labor and overhead

30%

Costs in work in process inventory:

Materials

$174,100

Labor

70,500

Overhead

104,650

Total costs in beginning work in process

$349,250

Units started into production in January

74,000

Units completed and transferred in January

71,000

Costs added to production:

Materials

$926,225

Labor

609,476

Overhead

914,214

Total cots added into production in January

$2,449,915

Work in process ending

Units in process

25,500

Stage of completion for materials

60%

Stage of completion for labor and overhead

30%

Instructions:

Prepare a production cost report for Northern Illinois Manufacturing using the weighted-average method and then show the journal entry for transferring the units from Molding to the Welding Department.