Company A manufactures a high quality plastic pipe I twodepartments, cooking and molding. Materials are introduced atvarious points during the work in the cooking department. After thecooking is completed, the materials are transferred into themolding department, in which pipe is formed. Materials areaccounted for in the cooking department on a pound basis.Conversion cost are incurred evenly during the cooking process.
Production data:
Pounds in process, May 1: 100% complete as to materials,
90% complete as to conversion costs……………………………………..70,000
Pounds started into production during May……………………………..350,000
Pounds completed and transferred to molding……………………………….?
Pounds in process, May 31: 75% complete as to materials, 25%complete as to
Conversion costs……………………………………………………………………….40,000
Cost data:
Work in process inventory, May 1:
Materials cost………………………………………………………………………86,000
Conversion cost………………………………………………………………………..36,000
Cost added during May:
Materials cost……………………………………………………………………………447,000
Conversion cost……………………………………………………………………….198,000
The company uses the weighted-average method to account forunits and costs.
Following the steps in doing the process costing for the “Cookingdept”
First fill in the T-Account for May: WORK IN PROCESS-COOKING
Steps:
- Determine the “units to account for”
- Find the “units to account for”
- Summarize the cost to account for
- Get the equivalent units and the unit costs
- Assign the costs and get the cost accounted for
- Prepare the journal entry at the end of May for completedunites
