Work in Process Account Data for Two Months; Cost of Production Reports

Pittsburgh Aluminum Company uses a process cost system to record the costs of manufacturing rolled aluminum, which consists of the smelting and rolling processes. Materials are entered from smelting at the beginning of the rolling process. The inventory of Work in ProcessRolling on September 1 and debits to the account during September were as follows:

Bal., 800 units, 20% completed:

Direct materials (800 x $4.6) $ 3,680

Conversion (800 x 20% x $1.9) 304

$ 3,984

From Smelting Department, 18,320 units $86,104

Direct labor 23,764

Factory overhead 12,796

During September, 800 units in process on September 1 were completed, and of the 18,320 units entering the department, all were completed except 1,700 units that were 60% completed. Charges to Work in ProcessRolling for October were as follows:

From Smelting Department, 21,100 units $103,390

Direct labor 29,590

Factory overhead 15,938

During October, the units in process at the beginning of the month were completed, and of the 21,100 units entering the department, all were completed except 1,000 units that were 90% completed.

Required:

1. Enter the balance as of September 1 in a four-column account for Work in ProcessRolling. Record the debits and the credits in the account for September. Construct a cost of production report and present computations for determining (a) equivalent units of production for materials and conversion, (b) costs per equivalent unit, (c) cost of goods finished, differentiating between units started in the prior period and units started and finished in September, and (d) work in process inventory. If an amount box does not require an entry, leave it blank.

ACCOUNT Work in Process-Rolling Department ACCOUNT NO.

BALANCE

DATE ITEM POST. REF. DEBIT CREDIT DEBIT CREDIT

Sept. 1 Bal., 800 units, 20% completed

3,984

3,984

Sept. 30 Smelting Dept., 18,320 units at $4.7

86,104

Sept. 30 Direct labor

23,764

Sept. 30 Factory overhead

12,796

Sept. 30 Finished goods

Sept. 30 Bal., 1,700 units, 60% completed

If an amount is zero, enter in a zero "0". Round cost per unit answers to the nearest cent.

Pittsburgh Aluminum Company

Cost of Production Report-Rolling Department

For the Month Ended September 30

Whole Units Equivalent Units

Units Direct Materials (a) Conversion (a)

Units charged to production:

Inventory in process, September 1

Received from Smelting Department

Total units accounted for by the Rolling Department

Units to be assigned costs:

Inventory in process, September 1

Started and completed in September

Transferred to finished goods in September

Inventory in process, September 30

Total units to be assigned costs

Costs

Costs Direct Materials Conversion Total Costs

Cost per equivalent unit:

Total costs for September in Rolling Department $

$

Total equivalent units

Cost per equivalent unit (b) $

$

Costs assigned to production:

Inventory in process, September 1 $

Costs incurred in September

Total costs accounted for by the Rolling Department $

Costs allocated to completed and partially completed units:

Inventory in process, September 1 balance (c) $

To complete inventory in process, September 1 (c) $

$

Cost of completed September 1 work in process $

Started and completed in September (c) $

Transferred to finished goods in September (c) $

Inventory in process, September 30 (d)

Total costs assigned by the Rolling Department $

2. Provide the same information for October by recording the October transactions in the four-column work in process account. Construct a cost of production report, and present the October computations (a through d) listed in part (1). If an amount box does not require an entry, leave it blank.

ACCOUNT Work in Process-Rolling Department ACCOUNT NO.

Balance

DATE ITEM POST. REF. DEBIT CREDIT DEBIT CREDIT

October 1 Balance

October 31 Smelting Dept., 21,100 units at $4.9

October 31 Direct labor

October 31 Factory overhead

October 31 Finished goods

October 31 Bal., 1,000 units, 90% completed

If an amount is zero, enter in a zero "0". Round cost per unit answers to the nearest cent.

Pittsburgh Aluminum Company

Cost of Production Report-Rolling Department

For the Month Ended October 31

Whole Units Equivalent Units

Units Direct Materials (a) Conversion (a)

Units charged to production:

Inventory in process, October 1

Received from Smelting Department

Total units accounted for by the Rolling Department

Units to be assigned costs:

Inventory in process, October 1

Started and completed in October

Transferred to finished goods in October

Inventory in process, October 31

Total units to be assigned costs

Costs

Costs Direct Materials Conversion Total Costs

Cost per equivalent unit:

Total costs for October in Rolling Department $

$

Total equivalent units

Cost per equivalent unit (b) $

$

Costs assigned to production:

Inventory in process, October 1 $

Costs incurred in October

Total costs accounted for by the Rolling Department $

Costs allocated to completed and partially completed units:

Inventory in process, October 1 balance (c) $

To complete inventory in process, October 1 (c) $

$

Cost of completed October 1 work in process $

Started and completed in October (c)

Transferred to finished goods in October (c) $

Inventory in process, October 31 (d)

Total costs assigned by the Rolling Department $

3. The cost per equivalent unit for direct materials

from August to October. The cost per equivalent unit for conversion costs

from August to October. These changes

be investigated for their underlying causes, and any necessary corrective actions should be taken.