Finishing Department costs: Work in process inventory, April 1, 450 units; materials 100% complete; conversion 60% complete . Costs transferred in during the month from the preceding department, 1,950 units Materials cost added during the month Conversion costs incurred during the month Total departmental costs $ 8,208* 17,940 6,210 13,920 $46,278 Finishing Department costs assigned to: Units completed and transferred to finished goods, 1,800 units at $25.71 per unit.. $46,278 Work in process inventory, April 30, 600 units; materials 0% complete; conversion 35% complete. Total departmental costs assigned $46,278 "Consists of cost transferred in, $4,068; materials cost, $1,980; and conversion cost, $2,160.
Second Department—Weighted-Average Method
“I think we goofed when we hired that new assistant controller,” said Ruth Scarpino, president of Provost Industries. “Just look at this report that he prepared for last month for the Finishing Department. I can’t understand it.”
“He’s struggling to learn our system,” replied Frank Harrop, the operations manager. “The problem is that he’s been away from
“Yes, it does seem high; but on the other hand, I know we had an increase in materials prices during April, and that may be the explanation.” replied Mr. Harrop. “I’ll get someone else to redo this report and then we can see what’s going on.”
Provost Industries manufactures a ceramic product that goes through two processing departments—Molding and Finishing. The company uses the weighted-average method in its process costing.
Required:
1. Prepare a report for the Finishing Department showing how much cost should have been assigned to the units completed and transferred to finished goods, and how much cost should have been assigned to ending work in process inventory in the Finishing Department.
2. Explain to the president why the unit cost on the new assistant controller’s report is so high.
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