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Two Departments, Journal Entries with Supporting Calculations-Weighted Average Method Parker Laboratories, Inc., produces one of its products in two successive departments. All materials are added
Two Departments, Journal Entries with Supporting Calculations-Weighted Average Method Parker Laboratories, Inc., produces one of its products in two successive departments. All materials are added at the beginning of the process in Department 1; no materials are used in Department 2. Conversion costs are incurred evenly in both departments. August 1, 2019, inventory account balances are as follows: Materials inventory $15,000 Work in process-Department 1 (6,000 units, 25% finished) Direct materials 11,500 Conversion costs 18,750 Work in process - Department 2 (3,500 units, 35% finished) 41,000 Finished goods inventory (4,000 units @ $12.50) 50,000 During August, the following transactions occurred: 1. Purchased material on account, $58,000. 2. Placed $63,300 (16,000 units) of materials into process in Department 1. 3. Distributed total payroll costs: $83,770 of direct labor to Department 1, $42,300 of direct labor to Department 2, and $19,100 of indirect labor to Manufacturing Overhead. 4. Incurred other actual manufacturing overhead costs, $21,200. (Credit Other Accounts.) 5. Applied overhead to the two processing departments: Department 1, $21,080, Department 2, $17,900 6. Transferred 20,000 completed units from Department 1 to Department 2. The 2,000 units remaining in Department 1 were 30% completed with respect to conversion costs. 7. Transferred 15,000 completed units from Department 2 to Finished Goods Inventory. The 8,500 units remaining in Department 2 were 40% completed with respect to conversion costs. 8. Sold 13,000 units on account at $24 per unit. Parker uses weighted average inventory costing for finished goods inventory. Part A a. Record the August transactions in general journal form for Department 1 and Department 2. Hint Complete the product cost reports for Departments 1 and 2 before entering journal entries for transactions 6, 7, and 8. General Journal Ref. Description Debit Credit Answeraccounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryother accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold 1. Answer Answer General Journal Ref. Description Debit Credit Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryother accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold Answer Answer Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryQther accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold 2. Answer Answer Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryother accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold Answer Answer 3. Work in process - Department 1 Answer Answer Work in process - Department 2 Answer Answer Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryQther accounts SalesWages payableWork in process - Department 1 Work in process Department 2 Cost of goods sold Answer Answer Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryQther accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold Answer Answer Answer Accounts payable Accounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryQther accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold 4. Answer Answer Other accounts Answer Answer 5. Work in process - Department 1 Answer Answer AnswerAccounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryother accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold Answer Answer General Journal Ref. Description Debit Credit Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryQther accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold Answer Answer Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryother accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold Answer Answer AnswerAccounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryQther accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold Answer Answer Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryOther accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold 7 Answer Answer Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overhead Materials inventoryQther accounts SalesWages payableWork in process - Department 1 Work in process -Department 2 Cost of goods sold Answer Answer Answer Accounts payable Accounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryOther accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold 8. Answer Answer Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryQther accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold Answer Answer To record sales Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryother accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold Answer Answer General Journal Ref. Description Debit Credit AnswerAccounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryother accounts SalesWages payableWork in process - Department 1 Work in process -Department 2 Cost of goods sold Answer Answer To record cost of goods sold. Part B b. Prepare a product cost report (with its supporting calculations) for Department 1. Round average cost per equivalent unit to two decimal places. Use rounded answers for subsequent calculations. Round other answers to the nearest whole number. Parker Laboratories, Inc. Department 1 Flow of Units and Equivalent Units Calculations, August 2019 Equivalent Units % Work Direct % Work Conversion Done Materials Done Costs Complete/Transferred Answer Answer Answer Answer Answer Ending Inventory Answer Answer Answer Answer Answer Total Answer Answer Answer Product Cost Report Direct Conversion Materials Costs Beginning Inventory Answer Answer Answer Current Answer Answer Answer Total Costs to Account For Answer Answer Answer Total Equivalent Units Answer Answer Product Cost Report Direct Conversion Materials Costs Average cost/ Equivalent unit (round 2 decimal places) Answer Answer Complete / Transferred: Direct Materials Answer Conversion costs Answer Cost of Goods Manufactured Answer Ending Inventory: Direct Materials Answer Conversion costs Answer Cost of Ending Inventory Answer Total Costs Allocated Answer Part C c. Prepare a product cost report (with its supporting calculations) for Department 2. Round average cost per equivalent unit to two decimal places. Use rounded answers for subsequent calculations. Round other answers to the nearest whole number. Parker Laboratories, Inc. Department 2 Flow of Units and Equivalent Units Calculations, August 2019 Equivalent Units % Work Direct % Work Conversion Done Materials Done Costs Complete/Transferred Answer Answer Answer Answer Answer Ending Inventory Answer Answer Answer Answer Answer Total Answer Answer Answer Product Cost Report Direct Conversion Materials Costs Beginning Inventory Answer Answer Answer Current Answer Answer Answer Total Costs to Account For Answer Answer Answer Total Equivalent Units Answer Answer Average cost/ Equivalent unit (round 2 decimal places) Answer Answer Complete / Transferred: Direct Materials Answer Conversion costs Answer Cost of Goods Manufactured Answer Ending Inventory: Direct Materials Answer Conversion costs Answer Cost of Ending Inventory Answer Total Costs Allocated Answer Part D d. Determine the balances remaining in the Materials Inventory account, in each work in process account, and in the Finished Goods Inventory account Enter answers in the order of your journal entries in part a., using the first available answer box in the appropriate debitor credit column. Materials Inventory Bal. Answer Answer Answer Answer Bal. Answer Answer Work in Process-Dept 1 Bal. Answer Answer Answer Answer Answer Answer Answer Answer Bal. Answer Answer Work in Process- Dept 2 Bal. Answer Answer Answer Answer Answer Answer Answer Answer Bal. Answer Answer Finished Goods Inventory Bal. Answer Answer Answer Answer Bal. Answer Answer Two Departments, Journal Entries with Supporting Calculations-Weighted Average Method Parker Laboratories, Inc., produces one of its products in two successive departments. All materials are added at the beginning of the process in Department 1; no materials are used in Department 2. Conversion costs are incurred evenly in both departments. August 1, 2019, inventory account balances are as follows: Materials inventory $15,000 Work in process-Department 1 (6,000 units, 25% finished) Direct materials 11,500 Conversion costs 18,750 Work in process - Department 2 (3,500 units, 35% finished) 41,000 Finished goods inventory (4,000 units @ $12.50) 50,000 During August, the following transactions occurred: 1. Purchased material on account, $58,000. 2. Placed $63,300 (16,000 units) of materials into process in Department 1. 3. Distributed total payroll costs: $83,770 of direct labor to Department 1, $42,300 of direct labor to Department 2, and $19,100 of indirect labor to Manufacturing Overhead. 4. Incurred other actual manufacturing overhead costs, $21,200. (Credit Other Accounts.) 5. Applied overhead to the two processing departments: Department 1, $21,080, Department 2, $17,900 6. Transferred 20,000 completed units from Department 1 to Department 2. The 2,000 units remaining in Department 1 were 30% completed with respect to conversion costs. 7. Transferred 15,000 completed units from Department 2 to Finished Goods Inventory. The 8,500 units remaining in Department 2 were 40% completed with respect to conversion costs. 8. Sold 13,000 units on account at $24 per unit. Parker uses weighted average inventory costing for finished goods inventory. Part A a. Record the August transactions in general journal form for Department 1 and Department 2. Hint Complete the product cost reports for Departments 1 and 2 before entering journal entries for transactions 6, 7, and 8. General Journal Ref. Description Debit Credit Answeraccounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryother accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold 1. Answer Answer General Journal Ref. Description Debit Credit Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryother accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold Answer Answer Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryQther accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold 2. Answer Answer Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryother accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold Answer Answer 3. Work in process - Department 1 Answer Answer Work in process - Department 2 Answer Answer Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryQther accounts SalesWages payableWork in process - Department 1 Work in process Department 2 Cost of goods sold Answer Answer Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryQther accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold Answer Answer Answer Accounts payable Accounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryQther accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold 4. Answer Answer Other accounts Answer Answer 5. Work in process - Department 1 Answer Answer AnswerAccounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryother accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold Answer Answer General Journal Ref. Description Debit Credit Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryQther accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold Answer Answer Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryother accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold Answer Answer AnswerAccounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryQther accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold Answer Answer Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryOther accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold 7 Answer Answer Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overhead Materials inventoryQther accounts SalesWages payableWork in process - Department 1 Work in process -Department 2 Cost of goods sold Answer Answer Answer Accounts payable Accounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryOther accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold 8. Answer Answer Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryQther accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold Answer Answer To record sales Answer Accounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryother accounts SalesWages payableWork in process - Department 1 Work in process - Department 2 Cost of goods sold Answer Answer General Journal Ref. Description Debit Credit AnswerAccounts payableAccounts receivableFinished goods inventory Manufacturing overheadMaterials inventoryother accounts SalesWages payableWork in process - Department 1 Work in process -Department 2 Cost of goods sold Answer Answer To record cost of goods sold. Part B b. Prepare a product cost report (with its supporting calculations) for Department 1. Round average cost per equivalent unit to two decimal places. Use rounded answers for subsequent calculations. Round other answers to the nearest whole number. Parker Laboratories, Inc. Department 1 Flow of Units and Equivalent Units Calculations, August 2019 Equivalent Units % Work Direct % Work Conversion Done Materials Done Costs Complete/Transferred Answer Answer Answer Answer Answer Ending Inventory Answer Answer Answer Answer Answer Total Answer Answer Answer Product Cost Report Direct Conversion Materials Costs Beginning Inventory Answer Answer Answer Current Answer Answer Answer Total Costs to Account For Answer Answer Answer Total Equivalent Units Answer Answer Product Cost Report Direct Conversion Materials Costs Average cost/ Equivalent unit (round 2 decimal places) Answer Answer Complete / Transferred: Direct Materials Answer Conversion costs Answer Cost of Goods Manufactured Answer Ending Inventory: Direct Materials Answer Conversion costs Answer Cost of Ending Inventory Answer Total Costs Allocated Answer Part C c. Prepare a product cost report (with its supporting calculations) for Department 2. Round average cost per equivalent unit to two decimal places. Use rounded answers for subsequent calculations. Round other answers to the nearest whole number. Parker Laboratories, Inc. Department 2 Flow of Units and Equivalent Units Calculations, August 2019 Equivalent Units % Work Direct % Work Conversion Done Materials Done Costs Complete/Transferred Answer Answer Answer Answer Answer Ending Inventory Answer Answer Answer Answer Answer Total Answer Answer Answer Product Cost Report Direct Conversion Materials Costs Beginning Inventory Answer Answer Answer Current Answer Answer Answer Total Costs to Account For Answer Answer Answer Total Equivalent Units Answer Answer Average cost/ Equivalent unit (round 2 decimal places) Answer Answer Complete / Transferred: Direct Materials Answer Conversion costs Answer Cost of Goods Manufactured Answer Ending Inventory: Direct Materials Answer Conversion costs Answer Cost of Ending Inventory Answer Total Costs Allocated Answer Part D d. Determine the balances remaining in the Materials Inventory account, in each work in process account, and in the Finished Goods Inventory account Enter answers in the order of your journal entries in part a., using the first available answer box in the appropriate debitor credit column. Materials Inventory Bal. Answer Answer Answer Answer Bal. Answer Answer Work in Process-Dept 1 Bal. Answer Answer Answer Answer Answer Answer Answer Answer Bal. Answer Answer Work in Process- Dept 2 Bal. Answer Answer Answer Answer Answer Answer Answer Answer Bal. Answer Answer Finished Goods Inventory Bal. Answer Answer Answer Answer Bal
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