Equivalent Units and Related Costs; Cost of Production Report; Entries
Lily Flour Company manufactures flour by a series of three processes, beginning with wheat grain being introduced in the Milling Department. From the Milling Department, the materials pass through the Sifting and Packaging departments, emerging as packaged refined flour.
The balance in the account Work in Process-Sifting Department was as follows on July 1, 2014:
The following costs were charged to Work in Process-Sifting Department during July:
During July, 12,000 units of flour were completed. Work in Process-Sifting Department on July 31 was 1,000 units, 4⁄5 completed.
Required:
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1. Prepare a cost of production report for the Sifting Department for July. If an amount is zero, enter "0". If required, round your cost per equivalent unit answers to the nearest cent.
Lily Flour Company
Cost of Production Report-Sifting Department
For the Month Ended July 31, 2014
Unit Information
Units charged to production:
Inventory in process, July 1
Received from Milling Department
Total units accounted for by the Sifting Department
Units to be assigned costs:
Equivalent Units
Whole Units
Direct Materials
Conversion
Inventory in process, July 1
Started and completed in July
Transferred to Packaging Department in July
Inventory in process, July 31
Total units to be assigned costs
Cost Information
Costs per equivalent unit:
Direct Materials
Conversion
Total costs for July in Sifting Department
$
$
Total equivalent units
Cost per equivalent unit
$
$
Costs charged to production:
Direct Materials
Conversion
Total
Inventory in process, July 1
$
Costs incurred in July
Total costs accounted for by the Sifting Department
$
Cost allocated to completed and partially completed units:
Inventory in process, July 1 balance
$
To complete inventory in process, July 1
$
$
Cost of completed July 1 work in process
$
Started and completed in July
Transferred to Packaging Department in July
$
Inventory in process, July 31
Total costs assigned by the Sifting Department
$
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1. Calculate equivalent units for materials and conversion costs. Calculate the cost per equivalent unit for materials and conversion costs. Calculate the costs assigned to the beginning inventory, the units started and completed, and the ending inventory.
Learning Objective 2, Learning Objective 3 and Learning Objective 4.
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2. Journalize the entries for (1) costs transferred from Milling to Sifting and (2) the costs transferred from Sifting to Packaging.
(1)
(2)