Cornerstones of Cost Management 2nd Edition by Don Hansen ,Maryanne Mowen

Exercise 17

Weighted Average Method, Journal Entries
Muskoge Company uses a process-costing system. The company manufactures a product that is processed in two departments: Molding and Assembly. In the Molding Department, direct materials are added at the beginning of the process; in the Assembly Department, additional direct materials are added at the end of the process. In both departments, conversion costs are incurred uniformly throughout the process. As work is completed, it is transferred out. The following table summarizes the production activity and costs for February:

Required:
1. Using the weighted average method, prepare the following for the Molding Department:
a. A physical flow schedule
b. An equivalent units calculation
c. Calculation of unit costs. Round to four decimal places.
d. Cost of ending work in process and cost of goods transferred out
e. A cost reconciliation
2. Prepare journal entries that show the flow of manufacturing costs for the Molding Department. Materials are added at the beginning of the process.
3. Repeat Requirements 1 and 2 for the Assembly Department.