Paint by Number prepares and packages paint products. Paint by Number has two departments: Blending and Packaging. Direct materials are added at the beginning of the blending process (dyes) and at the end of the packaging process (cans). Conversion costs are added evenly throughout each process. Data from the month of May for the Blending Department are as follows: (Click the icon to view the data from May.) Paint by Number completed the following production cost report for its Blending Department for the month of May: (Click the icon to view the assignment of costs.) Read the requirements. Requirement 1. Prepare the journal entries to record the assignment of direct materials and direct labor and the allocation of manufacturing overhead to the Blending Department. Also, prepare the journal entry to record the costs of the gallons completed and transferred out to the Packaging Department. (Record debits first, then credits. Exclude explanations from any journal entries.) Begin with the summary journal entry to record the assignment of direct materials and direct labor and the allocation of manufacturing overhead to the Blending Department. Date May 31 Accounts Work-in-Process Inventory-Blending Raw Materials Inventory Wages Payable Work-in-Process Inventory-Blending Debit Credit 6,750 Data table Gallons Beginning Work-in-Process Inventory Started in production 0 gallons 9,000 gallons Completed and transferred out to Packaging in May 4,000 gallons Ending Work-in-Process Inventory (30% of the way through 5,000 gallons the blending process) Costs Beginning Work-in-Process Inventory $ 0 Costs added during May: Direct materials Direct labor Manufacturing overhead allocated Total costs added during May 6,750 1,300 2,000 $ 10,050 - X rt Reference COSTS Costs to account for: Paint by Number Production Cost Report - Blending Department (Partial) Month Ended May 31 Transferred Direct Conversion Total In Materials Costs Costs Beginning work-in-process n/a 69 0 $ 0 $ Costs added during the period n/a 6,750 3,300 10,050 Total costs to account for n/a 6,750 3,300 10,050 Divided by: Total EUP n/a 9,000 5,500 n/a $ 0.75 $ 0.60 $ 1.35 Cost per equivalent unit Costs accounted for: Completed and transferred out n/a 69 3,000 $ 2,400 $ 5,400 n/a 3,750 900 4,650 Ending work-in-process n/a $ 6,750 $ 3,300 $ 10,050 Total costs accounted for re Requirements 1. Prepare the journal entries to record the assignment of direct materials and direct labor and the allocation of manufacturing overhead to the Blending Department. Also, prepare the journal entry to record the costs of the gallons completed and transferred out to the Packaging Department. 2. Post the journal entries to the Work-in-Process Inventory-Blending T-account. What is the ending balance? 3. What is the average cost per gallon transferred out of the Blending Department into the Packaging Department? Why would the company managers want to know this cost? Print Done -