Problem no. 2 Elijah Inc. produces accent stripes for automobiles in 50-inch rolls. Each roll passes through three departments (Striping, Adhesion, and Packaging) before it is ready for shipment to customers. Product costs are tracked by department and assigned using a process costing system. Overhead is applied to production in each department at a rate of 80 percent of the department's direct labor cost. The following T-account information pertains to departmental operations for June 2022: Work in Process-Striping 20,000 90,000 80,000 ? Beginning DM DL Overhead Ending Work in Process-Packaging Beginning Transferred in DM DL Overhead Ending Required: 1. 17,000 2. 150,000 ? ? CGM ? 90,000 40,000 ? Beginning Transferred in Work in Process-Adhesion DM DL Overhead Ending Beginning TI Ending 70,000 7 22,600 ? ? 7 20,600 Finished Goods 185,000 880,000 ? 480,000 720,000 What was the cost of goods transferred from the Striping Department to the Adhesion Department for the month? How much direct labor cost was incurred in the Adhesion Department? How much overhead was assigned to production in the Adhesion Department for the month? 3. How much direct material cost was charged to products in the Packaging Department? 4. Prepare the journal entries for all interdepartmental transfers of products and the cost of the units sold during June 2022.
Problem no. 2 Elijah Inc. produces accent stripes for automobiles in 50-inch rolls. Each roll passes through three departments (Striping, Adhesion, and Packaging) before it is ready for shipment to customers. Product costs are tracked by department and assigned using a process costing system. Overhead is applied to production in each department at a rate of 80 percent of the department's direct labor cost. The following T-account information pertains to departmental operations for June 2022: Work in Process-Striping 20,000 90,000 80,000 ? Beginning DM DL Overhead Ending Work in Process-Packaging Beginning Transferred in DM DL Overhead Ending Required: 1. 17,000 2. 150,000 ? ? CGM ? 90,000 40,000 ? Beginning Transferred in Work in Process-Adhesion DM DL Overhead Ending Beginning TI Ending 70,000 7 22,600 ? ? 7 20,600 Finished Goods 185,000 880,000 ? 480,000 720,000 What was the cost of goods transferred from the Striping Department to the Adhesion Department for the month? How much direct labor cost was incurred in the Adhesion Department? How much overhead was assigned to production in the Adhesion Department for the month? 3. How much direct material cost was charged to products in the Packaging Department? 4. Prepare the journal entries for all interdepartmental transfers of products and the cost of the units sold during June 2022.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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Subject: Cost Accounting
Give what is required of the problem.
What is the answer to numbers 1, 2, 3 and 4?
Transcribed Image Text:Problem no. 2
Elijah Inc. produces accent stripes for automobiles in 50-inch rolls. Each roll passes through three departments
(Striping, Adhesion, and Packaging) before it is ready for shipment to customers. Product costs are tracked by
department and assigned using a process costing system. Overhead is applied to production in each department at
a rate of 80 percent of the department's direct labor cost.
The following T-account information pertains to departmental operations for June 2022:
Work in Process-Striping
20,000
90,000
80,000 ?
Beginning
DM
DL
Overhead
Ending
Work in Process-Packaging
Beginning
Transferred in
DM
DL
Overhead
Ending
Required:
1.
17,000
2.
150,000
?
? CGM
?
90,000
40,000
?
Beginning
Transferred in
Work in Process-Adhesion
DM
DL
Overhead
Ending
Beginning
TI
Ending
70,000
7
22,600 ?
?
?
20,600
Finished Goods
185,000
880,000 ?
480,000
720,000
What was the cost of goods transferred from the Striping Department to the Adhesion Department for
the month?
How much direct labor cost was incurred in the Adhesion Department? How much overhead was assigned
to production in the Adhesion Department for the month?
3.
How much direct material cost was charged to products in the Packaging Department?
4. Prepare the journal entries for all interdepartmental transfers of products and the cost of the units sold
during June 2022.
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