Two Departments, Journal Entries with Supporting Calculations-Weighted Average Method Patterson 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. Patterson uses the weighted average method for process costing. January 1, 2019, inventory account balances are as follows: Materials inventory $30,000 Work in process Department 1.000 units complete) Direct material 4,560 Conversion costs 10.640 Work in process-Department 20.50 units, 40complete) 43,439 Finished goods inwentory 2,000 units 516) 32,000 During January, the following transactions occurred: 1. Purchased material on account, $90,000 2. Placed $84,000 of material into process in Department 1. This $84,000 represents 24,000 units of materials. 3. Distributed total payroll costs: $108,116 of direct labor to Department 1, 562,700 of direct labor to Department 2 and 551,000 of indirect labor to Manufacturing Overhead. 4. Incurred other actual manufacturing overhead costs, $81,000. (Credit Other Accounts.) 5. Applied overhead to the two processing departments: 588,000 to Department 1 and 543,900 to Department 2 6. Transferred 25,000 completed units from Department 1 to Department 2. The 2,000 units remaining in Department 1 were 20 completed with respect to conversion costs. 7. Transferred 26,000 completed units from Department 2 to finished goods inventory. The 2,550 units remaining in Department 2 were 70% completed with respect to conversion costs 8. Sold 20,000 units on account at $27 per unit. Patterson uses weighted average inventory costing procedures for the finished goods inventory. Part A Part B Part C Part D Record the January 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 1. Materials inventory 90,000 Accounts Payable 0 2. Work in process-Department 1 84,000 Materials inventory O 3 Work in process Department 1 10R,116 Work in process Department 2 62,700 Manufacturing overhead 51,000 Wages payable O 221,816 Manufacturing overhead 81,000 Other accounts 5. Work in process Department 1 88.000 Work in process-Department 2 4 3,900 Manufacturing overhead 6 Work in process-Department 2 285,500 Work in process Department1 0 7. Finched goods inventory 400 400 Work in process Department 2 0 400 400 & Accounts receivable 540.000 Sales ov To record sales Cost of goods sold 1,834,616 Finished goods inventory O 32.000 X To record cost of goods sold Determine the balances remaining in the Materials inventory account, in each work in process account, and in the Finished Goods Inventory account Check d e 20, 000S Inventory. The 2.550 units remaining in Department 2 were 70% completed with respect to conversion costs. 8. Sold 20,000 units on account at $27 per unit. Patterson uses weighted average inventory costing procedures for the finished goods inventory. Part A Part B Part C Part 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. Bal 3 Materials Inventory 30.000 84000 90,000 36.000 Work in Process-Dept. 1 15.200 25 500 84.000 108,116 88.000 9.816 Work in Process-Dept. 2 43.439 62,700 43,900 285,500 35,139 Finished Goods Inventory 32.000 400,400 x 400,400 432.400 x 400 400 POSAO
