Select your language

Suggested languages for you:
Log In Start studying!
Answers without the blur. Just sign up for free and you're in → Illustration

Q32PGA

Expert-verified
Horngren'S Financial And Managerial Accounting
Found in: Page 1017

Short Answer

Dee Electronics makes game consoles in three processes: assembly, programming, and packaging. Direct materials are added at the beginning of the assembly process. Conversion costs are incurred evenly throughout the process. The Assembly Department had no Work-in-Process Inventory on October 31. In mid-November, Dee Electronics started production on 100,000 game consoles. Of this number, 90,000 game consoles were assembled during November and transferred out to the Programming Department. The November 30 Work-in-Process Inventory in the Assembly Department was 35% of the way through the assembly process. Direct materials costing $399,000 were placed in production in Assembly during November, direct labor of $139,000 was assigned, and manufacturing overhead of $130,280 was allocated to that department.

Requirements

1. Prepare a production cost report for the Assembly Department for November.

The company uses the weighted-average method.

2. Prepare a T-account for Work-in-Process Inventory—Assembly to show its activity during November, including the November 30 balance.

1. Production cost report

Production Cost Report for the Assembly Department

for November
Equivalent unit of production

UNITS

Physical units

Direct material

Conversion costs

Total

Units to account for:

  • Beginning WIP

  • Started in production

100,000

Total units to account for

100,000

Units accounted for:

  • Completed and transferred

90,000

90,000

90,000

  • Ending WIP

10,000

10,000

3,500

Total units accounted for

100,000

100,000

93,500

COSTS

Direct material

Conversion costs

Total costs

Costs to account for:

Beginning WIP

Cost added during the period

399,000

269,280

668,280

Total cost to account for

399,000

269,280

668,280

Divided by: total EUP

100,000

93,500

Cost per equivalent unit

$3.99

$2.88

Costs accounted for:

  • - Completed and transferred out

359,100

(90,000 x $3.99)

259,200

(90,000x$2.88)

618,300

  • - Ending WIP

39,900

(10,000x $3.99)

10,080

(3,500x$2.88)

49,980

Total costs accounted for

$399,000

$269,280

$668,280

2. The Ending balance of the WIP inventory account for the assembly department is $49,980

See the step by step solution

Step by Step Solution

Step-by-Step Solution:Step 1: Production Cost Report

Production cost report is prepared by the companies using the process costing system while determining the total manufacturing cost. It shows the detailed costing of the products.

Step 2: Equivalent unit of production for conversion cost

Step 3: T-account for work-in-process inventory-assembly

Particulars

Amount ($)

Particulars

Amount ($)

Beginning WIP

WIP-programming department

618,300

Direct material

399,000

Direct labor

139,000

Manufacturing overhead

130,280

Ending WIP

49,980

Most popular questions for Business-studies Textbooks

Icon

Want to see more solutions like these?

Sign up for free to discover our expert answers
Get Started - It’s free

Recommended explanations on Business-studies Textbooks

94% of StudySmarter users get better grades.

Sign up for free
94% of StudySmarter users get better grades.