PROBLEM 9-16 Interpreting a Report-Weighted Average Method L02, Lo3, Lo Cooperative San Jos of southern Sonora state in Mexico makes a unique svun and local herbs. The syrup is sold in small bottles and is prized as a flavorin 102. 103 L04 rupusing cane suga c for drinks and for Chapter 9 use in desserts. The bottles are sold fof $12)each. (The Mexican currency denoted by S.) The first stage in the productin process is carried out in teso fo which removes foreign matter from the raw materials and mixes them in in large vats. The company uses the weighted-average method in its pro hs the p r proportions Mixing Department for April appears below: A hastily prepared report for the 30,000 ....200,000 230,000 Units to be accounted for Work in process, April 1 (materials 90% Started into production 190,000 40,000 ..230,000 Units accounted for as follows: Transferred to next department. Work in process, April 30 (materials Total units accounted for Cost Reconciliation Cost to be accounted for Work in process, April 1 Cost added during the month..... $98,000 827,000 Total cost to be accounted for Cost accounted for as follows: Transferred to next department... Total cost accounted for 119,400 $805,600 .. $925,000 Management would like some additional information about Cooperative San Jos's operations Required: I. What were the equivalent units for the month? 2. What were the costs per equivalent unit for the month? The the following costs: materials, $67,800; and conversion c the month consisted of: materials, $579,000; and co beginning inventory consisted of st,$30,200. The costs added during 3 How many of the units transferred to the next department w 000, S the month? The manager of the Mixing Department stated, "Materials prices jumped from about $2. and completed during r unit in March to $3 per unit in April, but due to good cost control I was able to hold ou materials cost to less than $3 per unit for the month." Should this manager be rewarded for April good cost control? Explain. PROBLEM 9-17 Analysis of Work in Process T-account-Weighted-Average Method Weston Products manufactures an industrial cleaning compound that goe departments- Grinding, Mixing, and Cooking. All raw materials are in work in the Grinding Department. The Work in Process T-arco May is given below [L01, L02, LO3, LOA ll for the month. of material and of conversion costs in the ending inventory nits of material and of conversion costs that were required to com 3 Compute the beginning inventory ete the th number of units started and completed durin plete the begi costs of ending inventory and units transferred out. the month. Equivalent Units-FIFO Method [Lo61 EXERCISE 9A-9 Refer to the data for Alaskan Fisheries, Inc., in Exercise 9-12 Fisher the equivalent units for July for the Clean ing Department assuming that the company the FIFO method of accounting for units. uses ivalent Units; Cost per Equivalent Unit, Applying Costs-FIFO Method 1.06, L07, LO8, LO9 o-fer to the data for the Blending Department of Suns Reeme that the company uses the FIFO method rather than the wo Sunspot Beverages, Lid, in Problem 9-1 method in its process costing system. e. Determine the equivalent units for June for the Blending Department. h Compute the costs per equivalent unit for June for the Blending Department. : Determine the total cost of ending work in process inventory and the total cost of units trans ferred to the next process for the Blending Department in June. 4. Prepare a cost reconciliation report for the Blending Department for June. PROBLEM 9A-11 Equivalent Units; Applying Costs; Cost Reconcililiation Report-FIFO Method 1L.O6 L07, L08, L09] Selzik Company makes super-premium cake mixes that go through two processing departments Blending and Packaging. The following activity was recorded in the Blending Departiment during July in process, July 1 (materials 100% complete, conversion 30% complete) Units started into production. . 10,000 170,000 Production data: Cost data process, July 31 materials 100% complete, conversion 40% complete) Work in process inventory, July 1: 20.00 $8,500 $4,900 Materials cost . Conversion cost. $139,400 $244,200 Cost added during the month: Materials cost Conversion cost All materials are added at the beginning of work in the Blending De the FIFO method in its process costing system. Required 1. Determine the equivalent units for July for the Blending Department. Chapter 9 in the Blending Department. The company 2. Compute the costs per equivalent unit for July for the Blending Department 3. Determine the total cost of ending work in process inventory and the total c cost of units trans ferred to the next process for the Blending Department in July 4. Prepare a cost reconciliation report for the Blending Department for July. CASE 9A-12 Second Department-FIFO Method [L06, LO7, LO8] Refer to the data for Provost Industries in Case 9-19. Assume that the company uses the FIO 2 method in its process costing system. Required: 1. Prepare a report for the Finishing Department for April showing how much cost should have been assigned to the units completed and transferred to finished goods and how m should have been assigned to the ending work in process inventory uch cost 2. As stated in the case, the company experienced an increase in materials prices during April. Would the effects of this price increase tend to show up more under the weighted-average method or under the FIFO method? Why? Losses in Process Costing VE 10 losses osting. From the calculations so far, we have assumed that there has been no losses throug the production process. In reality, losses may occur during production. In this we will examine the treatment of the following two situations in process calculations: 1. Process with normal losses. 2. Process with abnormal losses. Normal Losses Certain losses during some production processes are unavoidable. For process of making shoes, after cutting the shape of the shoes, the leftoeome disposed of. Another example is brewing alcoholic drinks. During distillatito exemple, in the leather has to be distillation, some drink is lost through evaporation. This kind of losses is inherent in the produc cannot normal losses. even with the most efficient managemen We use the earlier example, S element of normal los uction process and i ng hava