The Assembly Department of BWL Surge Protectors began September with no work in

Question

The Assembly Department of BWL Surge Protectors began September with no work in process inventory. During the month, production that cost $35,282

(direct materials,$8,242, and conversion costs, $27,040) was started on 23,000 units. BWL completed and transferred to the Testing Department a total of 12,000 units. The ending work in process inventory was 35% complete as to direct materials and 80% complete as to conversion work.

Requirements

1. Compute the equivalent units for direct materials and conversion costs.

2. Compute the cost per equivalent unit.

3. Assign the costs to units completed and transferred out and ending work in process inventory.

4. Record the journal entry for the costs transferred out of the Assembly Department to the Testing Department.

5. Post all of the transactions in the "Work in Process

Inventorylong dash—Assembly"

T-account. What is the ending balance?

Explanation / Answer

1.

20800

2.

3.

$11,440

4. Assembly Direct Materials cost a/c Dr. 6240

Assembly Conversion cost a/c Dr 15600

To Testing department a/c 21840

(Being costs transferred to testing department)

5.Direct material a/c 6240

Conversion cost a/c 15600

To Work in process a/c 21840

(completed costs entered)

Closing stock a/c- materials Dr 2002

Closing stock a/c- materials Dr 11440

To Work in process a/c 13442

(being closing stock transferred)

Calculation of equivalent production: Particulars Units Direct Materials Conversion Costs Opening work in progress 0 0 0 Completed and tranferred units 12000 12000 12000 Closing stock
(Material 35%, Conversion cost 80%) 11000 3850 8800 Total equialent units 23000 15850

20800

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