Q1. "Vasquez Systems produces high-quality table tops. Each table top is produced from a single large tree in a three-step process consisting of milling, sanding, and cutting. All raw material is introduced at the start of the milling process. The company uses a process costing system for all costs incurred throughout the production cycle. The following data were extracted from each department's cost of production report prepared for April:
Milling Dept. - The beginning balance of work in process was $275,000. During April, additional costs of $690,000 were incurred. The additional costs were attributable to direct materials (70%), direct labor (20%), and factory overhead (10%). The ending balance of work in process was $160,000.
Sanding Dept. - The beginning balance of work in process was $175,000. During April, additional costs of $400,000 were incurred. The additional costs were attributable to direct labor (70%) and factory overhead (30%). The ending balance of work in process was $290,000.
Cutting Dept. - The beginning balance of work in process was $365,000. During April, additional costs of $150,000 were incurred. The additional costs were attributable to direct labor (60%) and factory overhead (40%). The ending balance of work in process was $210,000.
Prepare summary journal entries to reflect costs incurred by each department during April, as well as the transfer of costs between departments and into finished goods.
2. "Zeus Corporation produces cultured diamonds via a secretive process that grows the diamonds in a vacuum chamber filled with a carbon gas cloud. The diamonds are produced in a single continuous process, and Zeus uses the weighted-average process costing method of accounting for production.
The production process requires constant utilization of facilities and equipment, as well as direct labor by skilled technicians. As a result, direct labor and factory overhead are both deemed to be introduced uniformly throughout production."
The above beginning work in process inventory had an assigned cost of $3,000,000, divided between direct materials (30%), direct labor (20%), and factory overhead (50%).
Additional costs incurred during July were $9,500,000, divided between direct materials (15%), direct labor (25%), and factory overhead (60%).
Prepare a schedule showing the calculation of cost per equivalent unit.
3. "Zeus Corporation produces cultured diamonds via a secretive process that grows the diamonds in a vacuum chamber filled with a carbon gas cloud. The diamonds are produced in a single continuous process, and Zeus uses the weighted-average process costing method of accounting for production.
Below is the company's calculation of cost per equivalent unit for October. During October, the company completed and transferred 8,000 diamonds to finished goods. An additional 4,000 units were still in process at the end of the month. The ending work in process was 60% complete with respect to direct materials and 40% complete with respect to both elements of conversion cost."
Prepare a schedule showing the allocation of total cost between finished goods and ending work in process.
4. Howorth Dental Products is a London-based producer of a patented anti-microbial dental floss. All raw material is introduced at the beginning of the production process, but considerable processing time is needed to create the anti-microbial qualities of the specially designed floss. Howorth measures output in meters of floss and applies the weighted-average process costing method. The following information is available for a recent period:
Beginning work in process inventory:
140,000 meters at a cost of £46,200 for direct materials, £24,900 for direct labor, and £24,900 for factory overhead. The conversion process was 55% complete.
Units started into production: 260,000 meters
Units completed and transferred to finished goods: 380,000 meters
Ending work in process inventory: 20,000 meters, 30% complete
Additional costs incurred during the period:
"Direct materials, £85,400
Direct labor, £98,200
Factory overhead, £98,600"
Prepare a cost of production report for Howorth.
Attachment:- Assignment.rar