White Pearls Company (WPC) is a manufacturer of knock off jewelry. The firm makes trendy jewelry at a fraction of the cost of top designer brands. The firm's most popular item is a triple-stranded pearl necklace. Because of the large volume of production, the firm uses process costing to account for its production costs. The firm produces the necklace in two sequential processing departments. In June, the relevant figures for this item in the first processing department, Department 1. are as follows: Number of Units Work-in-process, June 1: 90% complete for direct materials and 75% complete for 2,500 conversion Started during June 12,625 Completed and transferred to Finished Goods during June 12,500 Work-in-process, June 30: 80% complete for direct materials and 50% complete ??? for conversion Costs $25,000 $32.750 Work-in-process, June 1 (material costs: $6,250; conversion costs: $18,750) Direct materials added during June Conversion added during June (direct labor = $40,645; overhead applied = $80,100) $120,745 Required: (Show supporting calculations to receive credit) Compute the following amounts using the first-in first out (FIFO) method for June: 1.(3.5 points) Direct material cost per equivalent unit 2. (3.5 points) Conversion cost per equivalent unit 3. (4 points) Total cost assigned to completed necklaces transferred to Department 2 during June 4. (2.5 points) Cost of the ending work-in-process inventory in Department 1 (7.5 points) Determine the journal entries to record the following events in June: 1. Using direct materials into production in Department 1 2. Adding conversion costs, direct labor cost and overhead applied into production in Department 1 3. Transferring 12.500 units from Department 1 to Department 2 White Pearls Company (WPC) is a manufacturer of knock off jewelry. The firm makes trendy jewelry at a fraction of the cost of top designer brands. The firm's most popular item is a triple-stranded pearl necklace. Because of the large volume of production, the firm uses process costing to account for its production costs. The firm produces the necklace in two sequential processing departments. In June, the relevant figures for this item in the first processing department, Department 1. are as follows: Number of Units Work-in-process, June 1: 90% complete for direct materials and 75% complete for 2,500 conversion Started during June 12,625 Completed and transferred to Finished Goods during June 12,500 Work-in-process, June 30: 80% complete for direct materials and 50% complete ??? for conversion Costs $25,000 $32.750 Work-in-process, June 1 (material costs: $6,250; conversion costs: $18,750) Direct materials added during June Conversion added during June (direct labor = $40,645; overhead applied = $80,100) $120,745 Required: (Show supporting calculations to receive credit) Compute the following amounts using the first-in first out (FIFO) method for June: 1.(3.5 points) Direct material cost per equivalent unit 2. (3.5 points) Conversion cost per equivalent unit 3. (4 points) Total cost assigned to completed necklaces transferred to Department 2 during June 4. (2.5 points) Cost of the ending work-in-process inventory in Department 1 (7.5 points) Determine the journal entries to record the following events in June: 1. Using direct materials into production in Department 1 2. Adding conversion costs, direct labor cost and overhead applied into production in Department 1 3. Transferring 12.500 units from Department 1 to Department 2
