NO.3 Downtown Brewery Company uses a process cost system with average cost flow assumption to account for the production of its only product. Ingredients are mixed and brewed in the first department, Mixing and Brewing. Then the product is transferred to the Canning Department, where the liquid brew is put into cans and cases. Brewing requires application of heat and results in some normal shrinkage of volume in the Mixing and Brewing Department. In the Canning Department, some product is spoiled. Spoilage in Canning occurs at the 80-percent stage of conversion, and the lost units are complete as to materials. The shrinkage in Mixing and Brewing is viewed as part of normal production and is not measured; however, spoilage in Canning is viewed as an internal failure cost- which can be sold at its salvage value of P0.25 per unit. The unrecoverable cost of spoilage is charged to FOH control. Data for January 2020 operations are: Mixing & Brewing Canning Units in beginning inventory 4,000 2,000 Units started in process in Mixing & Brewing Dep't this period 36,000 Units transferred from Mixing & Brewing to Canning Dep't Units transferred to Finished Goods Inventory this period 28,000 28,000 25,000 Units in ending inventory: Mixing & Brewing (100% materials; 40% labor & overhead) 6,000 Canning (100% materials; 50% labor & overhead) 1,000 Costs in the beginning inventory: Costs from preceding department Materials Labor Factory overhead Costs added during the current period: Materials Labor Factory overhead Required: a) Prepare a cost of Production Report for each department. $2,750 3,000 950 440 375 640 750 $24,200 7,600 4,120 3,930 5,440 7,860 b) Assuming the company uses a separate ledger account for work in process inventory in each department, prepare the general journal entry to record the transfer of cost out of each department during January. c) Assuming the company sets a 100% mark-up on its product costs, prepare the journal entry to record the sale of all the January finished goods.