We Bake Perfect Pies Company makes fruit pies using a process cost system. The d
ID: 2467196 • Letter: W
Question
We Bake Perfect Pies Company makes fruit pies using a process cost system. The dough is made in the mixing department and then moves to the rolling department where crusts are rolled and placed into baking pans. The pans move into the filling department where fruit is placed into the crusts. The pies then move to the baking department. Once the pies have been baked, they move to packaging they are boxed and then sent to Finished Goods. During the month of October the company had sales of $83,000. Each pie sells for $10.
Using the following information, determine the Gross Profit for the Month of October.
Mixing Department: Beginning Balance 0 Ending inventory 1000 pies at 40% completion DM used: $1000 DL used: $800 FOH allocated: $1200
Rolling Department: Beginning Balance 1600 pies that were 70% completed with costs of $600 Pies started: 9000 Pies transferred to Filling Department: 8100 Ending Inventory was 10% completed DL used: $2338 FOH allocated: $2000
Filling Department: Beginning Balance 3000 pies that were 20% completed with costs of $7500 Ending inventory was 75% completed DM used: $16200 DL used: $3800 FOH allocated: $1975
Baking Department: Beginning Balance 0 Pies Transferred into department 7600 FOH allocated: $14160 Ending inventory: 1300 pies that were 60% completed
Packaging Department: Beginning Balance: 2100 pies at 20% completion with costs of $12,600 Ending Inventory was 2000 pies at 90% completed DM used: $7875 DL used: $1945 FOH allocated: $3890
Finished Goods Department: Beginning Balance: 2600 pies with costs of $15626
Explanation / Answer
Calculation of Cost of Each Pie of Each Department Mixing department Cost Incurred by Mixing Deptt. Particulars Amount Beginning WIP $0 DM $1,000 DL $800 FOH $1,200 Total Costs $3,000 Particulars Units % Completed Eq. Units Eq. Costs Beginning Balance 0 Units Started Out 10000 Total Units 10000 Transffred Out to next deptt. 9000 100% 9000 $2,872 Closing WIP 1000 40% 400 $128 Total Units 10000 9400 $3,000 Cost Incurred by Rolling Deptt. Particulars Amount Beginning WIP $600 DL $2,338 FOH $2,000 Cost of Units transferred from previous Deptt. $2,872 Total Costs $7,810 Particulars Units % Completed Eq. Units Eq. Costs Beginning Balance 1600 70% Units Started Out 9000 Total Units 10600 Transffred Out to next deptt. 8100 100% 8100 $7,576 Closing WIP 2500 10% 250 $234 Total Units 10600 8350 $7,810 Cost Incurred by Filling Deptt. Particulars Amount Beginning WIP $7,500 DM $16,200 DL $3,800 FOH $1,975 Cost of Units transferred from previous Deptt. $7,576 Total Costs $37,051 Particulars Units % Completed Eq. Units Eq. Costs Beginning Balance 3000 20% Units Started Out 8100 Total Units 11100 Transffred Out to next deptt. 7600 100% 7600 $27,539 Closing WIP 3500 75% 2625 $9,512 Total Units 11100 10225 $37,051 Cost Incurred by Baking Deptt. Particulars Amount Beginning Balance $0 DL FOH $14,160 Cost of Units transferred from previous Deptt. $27,539 Total Costs $41,699 Particulars Units % Completed Eq. Units Eq. Costs Beginning Balance 0 Units Started Out 7600 Total Units 7600 Transferred to Packing deptt 6300 100% 6300 $37,105 Closing WIP 1300 60% 780 $4,594 Total Units 7600 7080 $41,699 Cost Incurred by Packing Deptt. Particulars Amount Beginning Balance $12,600 DM $7,875 DL 1945 FOH $3,890 Cost of Units transferred from previous Deptt. $37,105 Total Costs $63,415 Particulars Units % Completed Eq. Units Eq. Costs Beginning Balance 2100 Units Started Out 6300 Total Units 8400 Transferred to next deptt 6400 100% 6400 $49,495 Closing WIP 2000 90% 1800 $13,920 Total Units 8400 8200 $63,415 Cost Incurred by Packing Deptt. Particulars Amount Beginning Balance $15,626 Cost of Units transferred from previous Deptt. $49,495 Total Costs $65,121 Particulars Units % Completed Eq. Units Eq. Costs Beginning Balance 2600 Units Started Out 6400 Total Units 9000 Sale of pies 8300 100% 8300 $60,527 Closing WIP 700 90% 630 $4,594 Total Units 9000 8930 $65,121 Calculation of Gross Profit of We Bake Particulars Amount Sales (8300 Bakes X $10) $83,000 Less: Cost of Goods Sold $60,527 Gross Profit $22,473
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