Weighted Average Method, Journal Entries

Muskoge Company uses a process$-$costing system. The company manufactures a product that is processed in two departments: Molding and Assembly. In the Molding Department, direct materials are added at the beginning of the process; in the Assembly Department, additional direct materials are added at the end of the process. In both departments, conversion costs are incurred uniformly throughout the process. As work is completed, it is transferred out. The following table summarizes the production activity and costs for February:

Molding Assembly

Beginning inventories:

Physical units $10,0008,000$

Costs:

Transferred in $$ $$45,200$

Direct materials $$22,000$

Conversion costs $$13,800$ $$20,450$

Current production:

Units started $25,000?$

Units transferred out $30,00035,000$

Costs:

Transferred in $?$

Direct materials $$56,750$ $$40,250$

Conversion costs $$103,500$ $$140,150$

Percentage of completion:

Beginning inventory $40\%50\%$

Ending inventory $8050$

Required:

Question Content Area

$1.$ Using the weighted average method, prepare the following for the Molding Department:

a$.$ A physical flow schedule

Molding Department, Physical flow schedule:

Units to account for: blank

Units, beginning work in process

Units started in February

Total units to account for

fill in the blank eac$6$b$2$fcef$8801$e$\_5$

Units accounted for: blank

Units completed and transferred out:

Started and completed

From beginning work in process

Units, ending work in process

Total units accounted for

fill in the blank eac$6$b$2$fcef$8801$e$\_12$

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Feedback

a$.$ The physical flow schedule traces the units in process regardless of their stage of completion.

Question Content Area

b$.$ An equivalent units calculation

Total equivalent units

Direct Materials

fill in the blank $39$f$41$c$0$a$0$fd$8$f$99\_1$

Conversion Costs

fill in the blank $39$f$41$c$0$a$0$fd$8$f$99\_2$

c$.$ Calculation of unit costs. Round your intermediate computations and final answer to four decimal places.

$

fill in the blank $39$f$41$c$0$a$0$fd$8$f$99\_3$

per unit

d$.$ Calculate the cost of ending work in process and cost of goods transferred out. Round your answers to the nearest dollar.

Cost of ending work in process: $

fill in the blank $39$f$41$c$0$a$0$fd$8$f$99\_4$

Cost of goods transferred out: $

fill in the blank $39$f$41$c$0$a$0$fd$8$f$99\_5$

e$.$ A cost reconciliation. When required, round your answers to the nearest dollar.

Costs to account for:

Beginning work in process $

fill in the blank $39$f$41$c$0$a$0$fd$8$f$99\_6$

Costs incurred

fill in the blank $39$f$41$c$0$a$0$fd$8$f$99\_7$

Total costs to account for $

fill in the blank $39$f$41$c$0$a$0$fd$8$f$99\_8$

Costs accounted for:

Transferred out $

fill in the blank $39$f$41$c$0$a$0$fd$8$f$99\_9$

Ending work in process

fill in the blank $39$f$41$c$0$a$0$fd$8$f$99\_10$

Total costs accounted for $

fill in the blank $39$f$41$c$0$a$0$fd$8$f$99\_11$

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Feedback

b$.$ To calculate equivalent units, weighted average counts prior$-$period output in BWIP as belonging to the current period. All units are output in the current period.

c$.$ Unit cost $=$ Unit direct materials cost $+$ Unit conversion costs

d$.$ Costing out ending work in process is done by computing the cost of each input and then adding to obtain the total. The valuation of cost of goods transferred out is simplified as it is the total unit cost multiplied by the units completed.

e$.$ Reconciliation is making sure that the costs assigned to goods or services completed and EWIP are equal to the costs to account for.

Question Content Area

$2.$ Prepare journal entries that show the flow of manufacturing costs for the Molding Department. $($a$)$ Materials are added at the beginning of the process, $($b$)$ conversion costs are recorded, and $($c$)$ units are transferred to the Assembly Department. When required, round your answers to the nearest dollar.

a$.$

b$.$

c$.$

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$2.$ An example of journal entries showing the flow of costs is illustrated above Exhibit $6\mathrm{.}5.$

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$3.$ Repeat Requirements $1$ and $2$ for the Assembly Department.

a$.$ A physical flow schedule:

Assembly Department, Physical flow schedule:

Units to account for: blank

$-$ Select $-$

$-$ Select $-$

Total units to account for

fill in the blank $487653$ff$5$fa$3$fa$3\_5$

Units accounted for: blank

Units completed and transferred out:

$-$ Select $-$

$-$ Select $-$

$-$ Select $-$

Total units accounted for

fill in the blank $487653$ff$5$fa$3$fa$3\_12$

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Feedback

$3.$ Read the problem carefully. There are some differences in how the material additions are accounted for.

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b$.$ An equivalent units calculation

Total Equivalent Units

Direct Materials

fill in the blank $5$b