A)
Entries for Materials Cost Flows in a Process Cost System
The Hershey Company manufactures chocolateconfectionery products. The three largest raw materials are cocoa,sugar, and dehydrated milk. These raw materials first go into theBlending Department. The blended product is then sent to theMolding Department, where the bars of candy are formed. The candyis then sent to the Packing Department, where the bars are wrappedand boxed. The boxed candy is then sent to the distribution center,where it is eventually sold to food brokers and retailers.
Show the accounts debited and credited for each of the followingbusiness events:
a. Materials used by the BlendingDepartment.
| Debit account | |
| Credit account | |
| Credit account | |
| Credit account | |
b. Transfer of blended product to the MoldingDepartment.
| Debit account | |
| Credit account | |
c. Transfer of chocolate to the PackingDepartment.
| Debit account | |
| Credit account | |
d. Transfer of boxed chocolate to thedistribution center.
| Debit account | |
| Credit account | |
e. Sale of boxed chocolate.
| Debit account | |
| Credit account | |
B)
Equivalent Units of Production
The Converting Department of Soft Touch Towel and Tissue Companyhad 1,040 units in work in process at the beginning of the period,which were 30% complete. During the period, 21,600 units werecompleted and transferred to the Packing Department. There were1,160 units in process at the end of the period, which were 70%complete. Direct materials are placed into the process at thebeginning of production.
Determine the number of equivalent units of production withrespect to direct materials and conversion costs. If an amount iszero, enter in "0".
| Soft Touch Towel and Tissue Company |
| Number of Equivalent Units of Production |
|
| Whole Units | Direct Materials
Equivalent Units | Conversion
Equivalent Units |
| Inventory in process, beginning | | | |
| Started and completed | | | |
| Transferred to Packing Department | | | |
| Inventory in process, ending | | | |
| Total | | | |
C)
Equivalent Units of Production
The following information concerns production in the BakingDepartment for March. All direct materials are placed in process atthe beginning of production.
| ACCOUNT Work in Process—BakingDepartment | ACCOUNT NO. |
| Date | Item | Debit | Credit | Balance |
| Debit | Credit |
| March | 1 | Bal., 8,400 units, 2/5 completed | | | 33,600 | | |
| 31 | Direct materials, 151,200 units | 302,400 | | | 336,000 | | |
| 31 | Direct labor | 89,270 | | | 425,270 | | |
| 31 | Factory overhead | 50,212 | | | 475,482 | | |
| 31 | Goods finished, 153,300 units | | 458,346 | | 17,136 | | |
| 31 | Bal. ? units, 4/5 completed | | | 17,136 | | |
a. Determine the number of units in work inprocess inventory at March 31.
units
b. Determine the equivalent units of productionfor direct materials and conversion costs in March. If an amount iszero, enter in "0".
| Baking Department |
| Equivalent Units of Production for Direct Materialsand Conversion Costs |
| For March |
| Whole Units | Direct Materials
Equivalent Units | Conversion Equivalent Units |
| Inventory in process, March 1 | | | |
| Started and completed in March | | | |
| Transferred to finished goods in March | | | |
| Inventory in process, March 31 | | | |
| Total | | | |
D)
Costs per Equivalent Unit
The following information concerns production in the BakingDepartment for March. All direct materials are placed in process atthe beginning of production.
| ACCOUNT Work in Process—BakingDepartment | ACCOUNT NO. |
| Date | Item | Debit | Credit | Balance |
| Debit | Credit |
| Mar. | 1 | Bal., 6,000 units, 2/5 completed | | | 12,600 | | |
| 31 | Direct materials, 108,000 units | 194,400 | | | 207,000 | | |
| 31 | Direct labor | 55,760 | | | 262,760 | | |
| 31 | Factory overhead | 31,360 | | | 294,120 | | |
| 31 | Goods finished, 109,500 units | | 284,580 | | 9,540 | | |
| 31 | Bal. ? units, 2/5 completed | | | 9,540 | | |
a. Based on the above data, determine each costlisted below. Round "cost per equivalent unit" answers to thenearest cent.
| 1. Direct materials cost per equivalent unit | $ |
| 2. Conversion cost per equivalent unit | $ |
| 3. Cost of the beginning work in process completed duringMarch | $ |
| 4. Cost of units started and completed during March | $ |
| 5. Cost of the ending work in process | $ |
b. Assuming that the direct materials cost isthe same for February and March, did the conversion cost perequivalent unit increase, decrease, or remain the same inMarch?
