Sold during current period wang 2013 8 journal

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Unformatted text preview: nt period Wang 2013 8 Journal Entries • Costs Accumulation for Department A (Process A) – Dr. WIP-Process A XXX Cr. Raw Materials Inventory – Dr. WIP-Process A XXX Cr. Wages Payable – Dr. WIP-Process A XXX Cr. Manufacturing Overhead XXX XXX XXX • Transfer to Next Department (Process B) – Dr. WIP-Process B Cr. WIP-Process A Wang 2013 XXX XXX 9 Journal Entries • Costs Accumulation for Process B – Dr. WIP-Process B Cr. Raw Materials Inventory – Dr. WIP-Process B Cr. Wages Payable – Dr. WIP-Process B Cr. Manufacturing Overhead XXX XXX XXX XXX XXX XXX • Goods Completed – Dr. Finished Goods Inventory Cr. WIP-Process B XXX XXX • Goods Sold – Dr. Cost of Goods Sold Cr. Finished Goods Inventory Wang 2013 XXX XXX 10 Equivalent Units: A Key Concept • Costs are accumulated for a period of time for products in work-in-process inventory. • Products in work-in-process inventory at the beginning and end of the period are only partially complete. • Equivalent units is a concept expressing these partially completed products as a smaller number of fully completed products. Wang 2013 11 Equivalent Units Example Two one-half completed products are equivalent to one completed product. + = l So, 10,000 units 70 percent complete are equivalent to 7,000 complete units. Wang 2013 12 Equivalent Units Question 1 For the current period, Jones started 15,000 units and completed 10,000 units, leaving 5,000 units in process 30 percent complete. How many equivalent units of production did Jones have for the period? a. 10,000 10,000 units + (5,000 units × .30) b. 11,500 = 11,500 equivalent units c. 13,500 d. 15,000 Wang 2013 13 Equivalent Units Question 2 If Jones incurred $27,600 in production costs for the 11,500 equivalent units. What was Jones’s cost per equivalent unit for the period? a. $1.84 $27,600 ÷ 11,500 equivalent units b. $2.40 = $2.40 per equivalent unit c. $2.76 d. $2.90 Wang 2013 14 Calculating and Using Equivalent Units of Production To calculate the direct materials and conversion costs per equivalent unit for the period: Materials cost per equivalent unit Conversion cost per equivalent unit Wang 2013 = DL + MO = Materials cost for the period Materials equivalent units for the period Conversion cost for the period Conversion equivalent units for the period 15 Equivalent Units of Production – Weighted-Average Method The weighted-average...
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This document was uploaded on 03/06/2014.

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