Managerial Accounting (5th Edition)
5th Edition
ISBN: 9780134128528
Author: Karen W. Braun, Wendy M. Tietz
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Textbook Question
Chapter 5, Problem 5.37BE
Exercises Group B
E5-37B Analyze flow of costs through inventory T-accounts (Learning Objective 1)
Early Start Bakery mass-produces bread using three sequential processing departments: Mixing, Baking, and Packaging. The following transactions occurred during February:
1. Direct materials used in the Packaging Department | $ 30,000 |
2. Costs assigned to units completed and transferred out of Mixing | $228,000 |
3. Direct labor incurred in the Mixing Department | $ 11,200 |
4. Beginning balance: Work in Process Inventory—Baking | $ 15,900 |
5. Manufactured |
$ 70,000 |
6. Beginning balance: Finished Goods Inventory | $ 4,900 |
7. Costs assigned to units completed and transferred out of Baking | $301,000 |
8. Beginning balance: Work in Process Inventory—Mixing | $ 12,100 |
9. Direct labor incurred in the Packaging Department | $ 8,800 |
10. Manufacturing overhead allocated to the Mixing Department | $ 67,000 |
11. Direct materials used in the Mixing Department | $151,000 |
12. Beginning balance: Raw Materials Inventory | $ 23,500 |
13. Costs assigned to units completed and transferred out of Packaging | $380,000 |
14. Beginning balance: Work in Process Inventory—Packaging | $ 8,200 |
15. Purchases of Raw Materials | $177,000 |
16. Direct labor incurred in the Baking Department | $ 4,600 |
17. Manufacturing overhead allocated to the Packaging Department | $ 46,000 |
18. Cost of goods sold | $381,000 |
Requirements
- 1. Post each of these transactions to the company’s inventory T-accounts. You should set up separate T-accounts for the following:
- Raw Materials Inventory
- Work in Process Inventory—Mixing Department
- Work in Process Inventory—Baking Department
- Work in Process Inventory—Packaging Department
- Finished Goods Inventory
- 2. Determine the balance at month-end in each of the inventory accounts.
- 3. Assume 3,375,000 loaves of bread were completed and transferred out of the Packaging Department during the month. What was the cost per unit of making each loaf of bread (from start to finish)?
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
E4-23A Use ABC to allocate manufacturing overhead (Learning Objective 2)
Several years after reengineering its production process, Biltmore Corporation hired a new controller, Rachael Johnson. She developed an ABC system very similar to the one used by Biltmore’s chief rival, Westriver. Part of the reason Johnson developed the ABC system was because Biltmore’s profits had been declining even though the company had shifted its product mix toward the product that had appeared most profitable under the old system. Before adopting the new ABC system, Biltmore had used a plantwide overhead rate based on direct labor hours that was developed years ago.
For the upcoming year, Biltmore’s budgeted ABC manufacturing overhead allocation rates are as follows:
Activity Allocation Base Activity Cost Allocation Rate
Materials handling # of parts $3.84 per part
Machine setup # of setups $330.00 per setup
Insertion of parts # of parts $30.00 per part
Finishing Finishing DL hrs $54.00 per hour
The…
The cutting department of Legacy Production Company started 40,000 units of specialized chairs during the month of March. The department incurred $15,000 in direct material costs; 2,500 direct labor hours paid at $10 per hour; and manufacturing overhead applied at 150% of direct labor cost. Legacy Production Company uses process costing to accumulate costs. NOTE: There was no beginning inventory in March.
Required (Excel Template downloadProvided): (Module Learning Outcomes LO5.1 through LO5.5 AND Course Learning Outcome #1 & #2)
Calculate the conversion costs incurred during the month of March (show your calculations).
Assume, that only 30,000 units were completed and transferred out. The remaining units left in ending inventroy are only 70% complete with respect to conversion costs. Direct materials are added at the beginning of the process. Prepare a Cutting Department cost production report for the month of March
Refer to the cost production report in part b. What are…
Compute departmental overhead rates (Learning Objective 1)54-4Snyder Snacks makes potato chips, corn chips, and cheese puffs using three different pro- duction lines within the same manufacturing plant . Currently, Snyder uses a single plant- wide overhead rate to allocate its $3,311,500 of annual manufacturing overhead . Of this amount, $2,070,000 is associated with the potato chip line, $763,000 is associated with the corn chip line, and $478,500 is associated with the cheese puff line. Snyder's plant is currently running a total of 17,900 machine hours: 11,500 in the potato chip line, 3,500 in the corn chip line, and 2,900 in the cheese puff line. Snyder considers machine hours to be the cost driver of manufacturing overhead costs .1. What is Snyder's plantwide overhead rate?2. Calculate the departmental overhead rates for Snyder's three production lines. Roundall answers to the nearest cent .3. Which products have been overcosted by the plantwide rate? Which products havebeen…
Chapter 5 Solutions
Managerial Accounting (5th Edition)
Ch. 5 - (Learning Objective 1) Which of the following is...Ch. 5 - (Learning Objective 2) Conversion costs consist of...Ch. 5 - (Learning Objective 2) Which of the following is...Ch. 5 - (Learning Objective 3) Which of the following is...Ch. 5 - Prob. 5QCCh. 5 - (Learning Objective 4) The journal entry needed to...Ch. 5 - (Learning Objective 4) A company has two...Ch. 5 - Prob. 8QCCh. 5 - Prob. 9QCCh. 5 - Prob. 10QC
Ch. 5 - Compare job costing and process costing (Learning...Ch. 5 - Prob. 5.2SECh. 5 - Prob. 5.3SECh. 5 - Determine the physical flow of units (process...Ch. 5 - Compute equivalent units (process costing Step 2)...Ch. 5 - Compute equivalent units (process costing Step 2)...Ch. 5 - Summarize total costs to account for (process...Ch. 5 - Prob. 5.8SECh. 5 - Prob. 5.9SECh. 5 - Prob. 5.10SECh. 5 - Prob. 5.11SECh. 5 - Prob. 5.12SECh. 5 - Prob. 5.13SECh. 5 - Prob. 5.14SECh. 5 - Prob. 5.15SECh. 5 - Prob. 5.16SECh. 5 - Continuation of S5-16: Record journal entry and...Ch. 5 - Compute equivalent units in second department...Ch. 5 - Prob. 5.19SECh. 5 - Prob. 5.20SECh. 5 - Prob. 5.21SECh. 5 - Prob. 5.22SECh. 5 - Analyze flow of costs through inventory T-accounts...Ch. 5 - Summarize physical units and compute equivalent...Ch. 5 - Prob. 5.25AECh. 5 - Prob. 5.26AECh. 5 - Continuation of E5-26A: Journal entries (Learning...Ch. 5 - Complete the production cost report in first...Ch. 5 - Prob. 5.29AECh. 5 - Analyze costs and gross profit in a process...Ch. 5 - Prob. 5.31AECh. 5 - Compute equivalent units and assign costs...Ch. 5 - Complete five-step procedure in first department...Ch. 5 - Sustainability and process costing (Learning...Ch. 5 - Complete five-step procedure and journalize result...Ch. 5 - Complete five-step procedure in second department...Ch. 5 - Exercises Group B E5-37B Analyze flow of costs...Ch. 5 - Summarize physical units and compute equivalent...Ch. 5 - Prob. 5.39BECh. 5 - Complete five-step procedure in first department...Ch. 5 - Prob. 5.41BECh. 5 - Prob. 5.42BECh. 5 - Prob. 5.43BECh. 5 - Prob. 5.44BECh. 5 - Record journal entries (Learning Objective 4)...Ch. 5 - Compute equivalent units and assign costs...Ch. 5 - Prob. 5.47BECh. 5 - Sustainability and process costing (Learning...Ch. 5 - Complete five-step procedure and journalize result...Ch. 5 - Complete five-step procedure in second department...Ch. 5 - Process costing in a single processing department...Ch. 5 - Process costing in a first department (Learning...Ch. 5 - Prob. 5.53APCh. 5 - Prepare a production cost report and journal...Ch. 5 - Prob. 5.55APCh. 5 - Process costing in a single processing department...Ch. 5 - Process costing in a first department (Learning...Ch. 5 - Prob. 5.58BPCh. 5 - Prepare a production cost report and journal...Ch. 5 - Prob. 5.60BPCh. 5 - Prob. 5.61SCCh. 5 - Discussion Questions 1. What characteristics of...Ch. 5 - Prob. 5.63ACTCh. 5 - Prob. 5.64ACTCh. 5 - Process costing and hybrid costing issues...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Beginning inventory and direct material cost added during the month total $55,000. What is the value of the ending work in process inventory if beginning inventory was 2,000 units; 9,000 units were started; and 1,000 units were in ending inventory? $1,000 $5,000 $50,000 $55,000arrow_forwardPROBLEM 1 Department II of Charity Manufacturing Company presents the following production data for the month of May, 2011: Opening inventory, 3/8 completed 4, 000 units Started in process 13,000 units Transferred 9,000 units Closing inventory, ½ completed 4,000 units ¾ completed 4, 000 units What are the equivalent units of production (conversion) for the month of May, 2011 under FIFO method? What are the equivalent units of production (conversion) for the month of May, 2011 under average method?arrow_forwardPreparing comprehensive accounting for manufacturing transactions Mighty Stars produces stars for elementary teachers to reward their students Mighty Stars’ trial balance on June 1 follows: June 1 balances in the subsidiary ledgers were as follows: • Raw Materials Inventory subsidiary ledger: Paper, $4,000; indirect materials, $2,000 • Work-in-Process Inventory subsidiary ledger: Job 120, $40,000; Job 121, $0 June transactions are summarized as follows: a. Collections on account, $145,000. b. Selling and administrative expenses incurred and paid, $32,000. c. Payments on account, $39,000. d. Materials purchases on account: Paper, $24,000; indirect materials, $4,200. e. Materials requisitioned and used in production: f. Wages incurred during June, $39,000. Labor time records for the month: Job 120, $3,600; Job 121, $17,000; indirect labor, $18,400. g. Wages paid in June include the balance in Wages Payable at May 31 plus $36,100 of wages incurred during June. h. Depreciation on plant and…arrow_forward
- Work-in-Process Inventory—Cutting Balance, May 1 0 (a) Transfer out to Direct Materials 49,000 Direct Labor 9,000 Manufacturing Overhead 33,000 Balance, May 31 6,000 Work-in-Process Inventory—Finishing Balance, May 1 17,000 80,000 Transfer out to Transfer in from (b) Direct Materials 26,000 Direct Labor (c) Manufacturing Overhead 16,000 Balance, May 31 67,000 Work-in-Process Inventory—Packaging Balance, May 1 6,000 (d) Transfer out to Transfer in from (e) Direct Materials 6,000 Direct Labor 13,000 Manufacturing Overhead 14,000 Balance, May 31 19,000 Finished Goods Inventory Balance, May 1 0 (f) Transfer out to Transfer in from (g)…arrow_forwardQuestion Content Area Complete this production cost report: Enter all amount as positive values. If required round "Cost per unit" answers to two decimal place. Production Cost Report Beginning inventory 21,000 Started during the month 76,000 Total units to account for fill in the blank 1 Completed and transferred out 73,000 Ending work in process fill in the blank 2 Total units to account for fill in the blank 3 Work in process completion percent 100% 25% Materials Units Conversion Units Total Units Completed and transferred out 73,000 73,000 73,000 Ending work in process fill in the blank 4 fill in the blank 5 fill in the blank 6 Total units to account for fill in the blank 7 fill in the blank 8 fill in the blank 9 Costs to account for Materials Conversion Total Beginning work in process $3,500 $16,000 $19,500 Transferred in — — — Incurred during the period 25,600 47,200 72,800 Total costs…arrow_forwardT2-7 Assign costs to completed units and ending Work in Process Inventory (LO 4) Monk, Inc. reported the following results for the month of November. Units Materials Conversion Work in Process Beginning inventory ? $ 5,900 $15,000 Added to production ? 47,300 65,000 Completed and transferred out ? ? ? Ending inventory 40,000 60% complete 40% complete Cost per equivalent unit $0.40 $0.64 Questions a.How many units were completed and transferred out of Work in Process Inventory? b.What cost should be assigned to the units transferred out of Work in Process Inventory? c.What cost should be assigned to the ending Work in Process Inventory?arrow_forward
- Objective 3 - Define tangible and intangible products, and explain why thereare different product cost definttions., 4 - Prepare income statements formanufacturing and service organizations.Ellerson Company provided the following information for the last calendaryear.Beginning inventory:Direct materials $68,000Work in process 29,400Finished goods 43,200Ending inventory:Direct materials $70,400Work in process 40,000Finished goods 42,100During the year, direct materials purchases amounted to $278,000, directlabor cost was S189,000, and overhead cost was $523,000. During the year,100,000 units were completed.Required:1, Calculate the total cost of direct materials used in production.2. Calculate the cost of goods manufactured. Calculate the unit manufacturingcost.3. Of the unit manufacturing cost calculated in Requirement 2, $2. 70 is directmaterials and S5.30 is overhead. What is the prime cost per unit? Conversioncost per unit?arrow_forwardComplete the information in the cost computations shown here: Raw materials Beginning inventory $342 Purchases 1,534 Materials available for use $fill in the blank 1 Ending inventory 320 Materials used in production $fill in the blank 2 Work in process inventory Beginning inventory $933 Materials used in production fill in the blank 3 Direct labor 1,533 Overhead applied fill in the blank 4 Manufacturing costs incurred $22,418 Ending inventory 933 Cost of goods manufactured $fill in the blank 5 Finished goods inventory Beginning inventory $fill in the blank 6 Cost of goods manufactured fill in the blank 7 Goods available for sale $24,982 Ending inventory fill in the blank 8 Cost of goods sold $21,769arrow_forwardExercise 2: Flow of Cost - Cost System You are required to compute for the unknowns in the following accounts: Materials Inventory 7,950 Purchase Returns 750 Purchases 27,500 Direct Materials ? Indirect Materials (e) Inventory, end 5,100 Work in Process Inventory 13,650 Cost of Goods Sold Completed (c) Direct Materials Cost 23,500 Direct Labor Cost (a) Factory Overhead Applied (100% of direct labor cost) (b) Inventory 11,750 62,150 Finished Goods Inventory 12,500 Cost of Goods Sold (d) Cost of Goods Sold Completed ? Inventory, end 11,250arrow_forward
- Problem 1.b.: Computation of Costs of Goods Manufactured (COGM).Akari Inc. provided the following information for its work-in-process inventory account at the end of the current month.Work-in-process Inventory (WIP)Accounts $ Accounts $Beginning balance $19,500 COGM ?Direct materials (DM) $76,200Direct labor (DL) $120,000MOH allocated $72,000Ending Balance $24,300Required: Compute the Costs of Goods Manufactured (COGM) at the end of the current month.Solution: Formula:Beginning WIP+ TMC (total manufacturing costs) for the periodDM usedDL incurredMOH allocatedTMC in WIP- Ending WIP= COGMarrow_forwardAccount Dollar amount Beginning Materials Inventory $74,323 Purchases ? Materials available for use 151,644 Ending inventory ? Materials used in production 78,413 Work In Process Inventory Beginning inventory 253,210 Materials used in production ? Direct labor 125,900 Overhead applied 94,425 Manufacturing costs incurred ? Ending inventory 242,932 Cost of goods manufactured ? Finished Goods Inventory Beginning inventory 333,149 Cost of goods manufactured ? Goods available for sale ? Ending inventory 354,235 Cost of goods sold ? Prepare the journal entries to record the following events: The purchase of materials The completion of work in process The sale of finished goods (omit the revenue side of the sale)arrow_forwardeBook Show Me How Question Content Area There were 1,500 units in beginning inventory that were 40% complete with regard to conversion. During the month, 8,550 units were started and 8,800 were transferred to finished goods. The ending work in process was 80% complete with regard to conversion costs, and materials are added at the beginning of the process. What is the total amount of equivalent units for materials and conversion at the end of the month using the weighted-average method? Equivalent units of Materials fill in the blank 1 Equivalent units of Conversion fill in the blank 2arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Principles of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College
Principles of Accounting Volume 2
Accounting
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax College
Fixed Asset Replacement Decision 1235; Author: Accounting Instruction, Help, & How To;https://www.youtube.com/watch?v=LJRzn9K8Nwk;License: Standard Youtube License