Equivalent Units and Related Costs; Cost of Production Report;Entries

Dover Chemical Company manufactures specialty chemicals by aseries of three processes, all materials being introduced in theDistilling Department. From the Distilling Department, thematerials pass through the Reaction and Filling departments,emerging as finished chemicals.

The balance in the account Work in Process—Filling was asfollows on January 1:

Work in Process—Filling Department
(3,000 units, 20% completed):
	Direct materials (3,000 x $13.10)	$39,300
	Conversion (3,000 x 20% x $8.40)	5,040
		$44,340

The following costs were charged to Work in Process—Fillingduring January:

Direct materials transferred from Reaction
	Department: 38,700 units at $12.80 a unit	$495,360
Direct labor		171,580
Factory overhead		164,852

During January, 38,400 units of specialty chemicals werecompleted. Work in Process—Filling Department on January 31 was3,300 units, 40% completed.

Required:

1. Prepare a cost of production report for theFilling Department for January. If an amount is zero, enter "0". Ifrequired, round your cost per equivalent unit answers to twodecimal places.

Dover Chemical Company
Cost of Production Report-Filling Department
For the Month Ended January 31
Unit Information
Units charged to production:
Inventory in process, January 1
Received from Reaction Department
Total units accounted for by the FillingDepartment
Units to be assigned costs:
		Equivalent Units
	Whole Units	Direct Materials	Conversion
Inventory in process, January 1
Started and completed in January
Transferred to finished goods in January
Inventory in process, January 31
Total units to be assigned costs
Cost Information
Costs per equivalent unit:
		Direct Materials	Conversion
Total costs for January in Filling Department		$	$
Total equivalent units
Cost per equivalent unit		$	$
Costs charged to production:
	Direct Materials	Conversion	Total
Inventory in process, January 1			$
Costs incurred in January
Total costs accounted for by the FillingDepartment			$
Cost allocated to completed and partially completedunits:
Inventory in process, January 1 balance			$
To complete inventory in process, January 1	$	$
Cost of completed January 1 work in process			$
Started and completed in January
Transferred to finished goods in January			$
Inventory in process, January 31
Total costs assigned by the Filling Department			$

Feedback

2. Journalize the entries for (1) coststransferred from Reaction to Filling and (2) the costs transferredfrom Filling to Finished Goods.

(1)	Work in Process-Filling Department
	Work in Process-Reaction Department
(2)	Finished Goods
	Work in Process-Filling Department

Feedback

3. Determine the increase or decrease in thecost per equivalent unit from December to January for directmaterials and conversion costs. If required, round your answers totwo decimal places.

	Increase or Decrease	Amount
Change in direct materials cost per equivalent unit	Decrease	$
Change in conversion cost per equivalent unit	Increase

4. The cost of production report may be used asthe basis for allocating product costs between Work inProcess  and Finished Goods . The report can also be usedto control costs by holding each department head responsible forthe units entering production and the costs incurred in thedepartment. Any differences in unit product costs from one month toanother, such as those in part (3), can be studied carefully andany significant differences investigated.