Compute the equivalent units of production for the moulding

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Reference no: EM131872790

PROBLEM - Brandon Processing Company produces a product by passing it through a moulding process and then through an assembly process. Brandon uses the Weighted Average Method for process costing. Information related to manufacturing activities during July follows:

 

RAW MATERIALS:

 

Beginning inventory

$100,000

Raw materials purchased on credit

300,000

Direct materials used in moulding

(190,000)

Direct materials used in assembling

(88,600)

Indirect materials used

(51,400)

Ending Inventory

$70,000

FACTORY PAYROLL:

 

Direct labour used in moulding

$42,000

Direct labour used in assembling

55,375

Indirect labour used

50,625

Total payroll cost (paid with cash)

$148,000

FACTORY OVERHEAD INCURRED:

 

Indirect materials used

$51,400

Indirect labour used

50,625

Other overhead costs

71,725

Total factory overhead incurred

$173,750

FACTORY OVERHEAD APPLIED:

 

Moulding (150% of direct labour)

$63,000

Assembling (200% of direct labour)

110,750

Total factory overhead applied

$173,750

 

 

MOULDING DEPARTMENT:

 

Beginning work in process inventory (units)

8,000

 Percentage completed - materials

100%

  Percentage completed - labour and overhead

60%

Units started and completed

17,000

 

 

 

 

Ending work in process inventory (units)

8,000

  Percentage completed - materials

100%

  Percentage completed - labour and overhead

25%

Costs:

 

Beginning in process inventory (Materials: $40,000,  Direct Labour  $10,000, Overhead  $3,000)

$53,000

Direct materials added

190,000

Direct labour added

42,000

Overhead applied (150% of direct labour)

63,000

Total costs

348,000

ASSEMBLING DEPARTMENT:

 

Beginning work in process inventory

$154,800

Ending goods in process inventory

108,325

FINISHED GOODS INVENTORY:

 

Beginning inventory

$96,400

Costs transferred in from assembling

578,400

Cost of goods sold

(506,100)

Ending inventory

$168,700

 

Required:

 

1. Compute the equivalent units of production for the moulding department for July, and determine the costs per equivalent unit for direct materials, direct labour, and overhead.

 

2. Compute the cost of the units transferred from moulding to assembling during the month and the cost of the ending work in process inventory for the moulding department.

 

3. Prepare summary journal entries to record the events of July.

Reference no: EM131872790

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