Exercise 7: Process Costing: Cost of Production Report under WA & FIFO Methods

At the beginning of September 20x3, Nation Lovers PLC had 1250 units partially

assembled units in the Machining Department. During September 20x3, Nation

Lovers PLC placed another 4000 units into production. Data for the Machining

Department for Sept, 20x3 are:

Physical units for September, 20x3

Work in process, beginning inventory (Sep 1).................... 1250 units

Direct Materials (100% complete)

Conversion costs (80% Complete)

Started during September ........................................... 4000 units

Completed and transferred out during September............... 4250 units

Work in process, ending inventory (Sep 30)...................... 1000units

Direct Materials (100% complete)

Conversion cost (60% complete)

Total Costs for Sep 20x3

Work in Process, beginning inventory

Direct Materials (1250 equivalent unit x $25 per unit ........... 31250

Conversion cost (1000, equivalent units x $15 per unit)........ 15000

46250

Direct materials costs added during September 100000

Conversion costs added during September. 72300

Total costs to account for 218550

Required: Prepare the Cost of Production Report and journalize the necessary entries under (a) WA Method & (b) FIFO Method