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PART 2 ( 2 5 marks ) Delightful Winery produces bottled wines for the hospitality industry in a four - stage process - Pumping, Filtration,
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marks
Delightful Winery produces bottled wines for the hospitality industry in a fourstage process
Pumping, Filtration, Filling and Capping. After leaving the Capping Department, the bottled wines are
packaged and sent to the Finished Goods warehouse for shipment to customers.
The following data relates to the Filling Department for the month of June during which bottled
wincs valued at $ were transferred from the Filtration Department to the Filling Department.
Other production costs incurred during the month are summarized as follows:
Process inspection occurs during the process and normally no losses are expected at this stage.
However, during the month of the bottled wines transferred into the Filling Department were
rejected at inspection. Rejected units from this department are sold as scrap at $ per bottle.
These units had reached the following degree of completion:
During June bottled wines were completed and transferred to the Capping Department.
Workinprogress at the end of June had reached the following degree of completion:
Materials added and conversion costs are incurred uniformly throughout each process.
There were no incomplete units in the Filling Department at the beginning of the period.
Required:
a Prepare a statement of equivalent production to determine the equivalent units for direct
materials From Filtration & Direct Material Added and conversion costs and the cost per
equivalent unit for direct materials and conversion costs.
b Compute the:
total cost of the bottled wines filled and transferred out of the Capping Department
cost of the unexpected losses
cost of ending work in process inventory in the Filling Department
c Post all transactions to the Work in Process Inventory Filling Department Taccount. What is
the ending balance?
d Prepare the journal entries for the:
assignment of direct materials, direct labour incurred, and the manufacturing overhead applied
to the Filling Process
cost of the bottles completed and transferred out to the Capping Department. marks
e Given that of the unexpected losses were because of pilferage, prepare the abnormal loss
statement, clearly showing Delightful Winery's true loss associated with the Filling
Department
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