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Process Costing Packaging Department

Direct materials are added 90% at the beginning of the process and the remaining 10% are added when the cereal is 50% complete with the packaging process. Direct labor and overhead are added evenly throughout the process.

Table 8 Unit and cost information

		Cost
	Physical Units	Transferred-in	Direct Materials	Direct Labor	Overhead
Beg WIP	4,000 (40% complete)	$15,000	$720	$466.09	$160
Transferred In	42,013	$153,867.71
End WIP	4,200 (30% complete)

Added during Qtr 1:

Direct Materials -- $10,678.25

Direct Labor 860 hrs @ $11.00 per hour

Overhead OH is applied based on predetermined OH rate and actual DL hours

1. Determine the number of units completed during quarter 1.

2. Compute the equivalent units using the weighted average method

3. Compute the cost per equivalent unit using the weighted average method

4. Compute the cost of goods transferred to finished goods inventory

5. Compute the ending balance in WIP, Packaging

Table 9 Actual Results (calculate revenue and COGS)

Units sold	Sales Price	Revenue
Units sold	Cost per unit	COGS

Table 10 DM Variances (corn only)

Price Variance
Usage Variance
Total Variance

Calculations:

Table 11 Direct Labor Variances

Rate Variance
Efficiency Variance
Total Variance

Calculations:

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