Units started in process in Distillation Department this period P7-7 (Appendix) Shrinkage in Process Costing; Fifo. Carlton Chemicals Company produces a single product in two departments, Distillation and Refining. Unrefined chemicals are mixed and heated in the Distillation Department. Then the product is transferred to the Refining Department, where it is heated, filtered, and purinto drums, Because of the heat applied to the product in both departments, some production shrinkage occurs. All shrink- age is viewed by management as part of the normal production process and is not meas- ured. Data for June operations are: Units in beginning inventory: Distillation Department (100% materials, 20% labor and overhead)...... Refining Department (100% materials, 50% labor and overhead)..... Distillation Refining 4,000 2,000 16,000 Units transferred from Distillation Department to Refining Department... 14,000 14,000 Units transferred to Finished Goods Inventory this period 12,000 Units in ending inventory: Distillation Department (100% materials, 80% labor and overhead. 2,000. Refining Department (100% materials, 30% labor and overhead. 2,000 Cost in beginning inventory: Cost from preceding department $3,500 $3,624 240 Materials 96 160 Labor. Factory overhead. 480 900 Cost added during the current period: 10,800 1,440 Materials. 1,480 1,740 Labor. 7,400 10,440 Factory overhead. Required: (1) Assuming the company uses fifo process costing, prepare a June cost of production report for each department. (2) Assuming the company uses separate general ledger accounts for each production department's work in process inventory, prepare the general journal entry to record the transfer of cost out of each department during June.