Problem 7: Pangani Company produces remote controls for toy cars. The production takes place in two separate departments. Department 2 receives units from Department 1 and applies conversion costs at a uniform rate. The company uses a Weighted Average costing system to account for its two manufacturing departments. In Department 2, two types of materials are added at two different points of the production process: the engine is added at the 40% conversion point and the remote control sensor is added at 80% conversion point. Following is a summary of costs and production in Department 2 for the month of April 2014: Physical Production Costs in S (Units) Beginning Balance (WIP) 8,000 units $ 226,000 (Engine) (60% conversion level) 0 (Sensor) 199,250 Conversion Cost 338,000 Transferred-In $763,250 Production Activities during April Transferred-In from Department 1 98,000 units $ 2,842,000 Completed during April --.??----units S -....??-.... Ending Balance (WIP) 11,000 units (75% S -....? ? -... conversion level) Costs incurred during April Material (Engine) $ 1,470,000 Material (Sensor) $ 380,000 Conversion Costs $ 1,969,000 Required Prepare a cost of production report for Department 2 for April 2014 and calculate the cost of goods C&T and EWIP ANSWER WEIGHTED AVERAGE Cost of Goods Completed and Transferred Out C&T 95,000 x (30 + 16 +4+21) Cost of ending WIP EB 11,000 x (30 + 16) + (8,250 x 21)