Average Method Department 2 Equivalent Units of Production

DEPARTMENT 2 EQUIVALENT UNITS OF PRODUCTION Transferred in cost from prior department Transferred out to next department (80% completed) 22,760 Work in process – Ending (5,690 x 100%)

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Average Method Department 2 Equivalent Units of Production

DEPARTMENT 2 EQUIVALENT UNITS OF PRODUCTION Transferred in cost from prior department Transferred out to next department (80% completed) 22,760 Work in process – Ending (5,690 x 100%)

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Roschelle Miguel

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AVERAGE METHOD

DEPARTMENT 2
EQUIVALENT UNITS OF PRODUCTION

Transferred in cost from prior department

Transferred out to next department (80% completed) 22,760
Work in process – Ending (5,690 x 100%) 5,690

Equivalent units for transferred in costs: 28,450

Direct Materials
Transferred out to next department (80% completed) 22,760
Work in process – Ending (5,690 x 90%) 5,121

Equivalent units for direct materials: 27,881

Conversion
Transferred out to next department (80% completed) 22,760
Work in process – Ending (5,690 x 55%) 3,130

Equivalent units for conversion: 25,890

AVERAGE METHOD
DEPARTMENT 2
BSA MANUFACTURING CORPORATION
COST OF PRODUCTION REPORT
FOR THE MONTH ENDED SEPTEMBER 30,2020
QUANTITY SCHEDULE

Units to be accounted for:

Work in process inventory – Beginning (direct materials 95% completed;
conversion costs 70% completed 1,000
Transferred In – Current Month 27,450

Total units to be accounted for: 28,450

Units accounted for as follows:

Transferred out to next department (28,450 x 80%) 22,760
Work in process inventory, Ending (direct materials 90% completed;
conversion costs 55% completed – 28,450 x 20%) 5,690

Total units accounted for: 28,450

COST SCHEDULE
Costs to Be Accounted For: Total Cost Equivalent Units Unit Costs
Costs Transferred In Fr. Prior Dept.
Work in Process – Beginning P 1,000
Transferred In-Current Month 165,647.79

Total Transferred In Costs P 166,647.79÷ 28,450 = P 5.857567

Costs Incurred in this Department
Materials: Beginning WIP P 8,000
Added this month 14,200
Total Materials P 22,200 ÷ 27,881 = 0.796241

Conversion: Beginning WIP P 21,000

Added this month 47,700
Total Conversion P 68,700 ÷ 25,890 = 2.653534
Total Costs in this Department P 90,900 P 3.449775
Cost to Account For: P 257,547.79 P 9.307342

Cost Accounted For:

Completed and Transferred out to next department P 211,835.10 = 22,760 x P 9.307342
Work in Process – Ending
Costs From Prior Department
Costs Incurred in this Department 33,329.56 = 5,690 x 5.857567
Materials 4,077.55 = 5,121 x 0.796241
Conversion 8,305.56 = 3,130 x 2.653534
Total Work in Process P 45,712.67
Total Costs Accounted For: P 257,547.77

AVERAGE METHOD
3. COST PER EQUIVALENT UNIT – DEPARTMENT 2
1. Costs Transferred In F. Prior Dept.
Work in process - Beginning P 1,000
Transferred during the month 165,647.79
P 166,647.79
Divide by units from preceding department 28,450
P 5.857567
2. Costs Incurred in this Department
Materials: Beginning WIP P 8,000
Add: Cost during the month 14,200
P 22,200
Divide by EUP – Direct materials 27,881
P 0.796241

Conversion: Beginning WIP P 21,000

Add: Cost during the month 47,700
P 68,700
Divide by EUP – Conversion 25,890
P 2.653534
4. COST OF UNITS TRANSFERRED TO THE NEXT DEPARTMENT
Total Cost Equivalent Units Unit Costs
Completed and Transferred P 211,835.10 = 22,760 x P 9.307342

5. COST OF WORK IN PROCESS – ENDING

Work in Process – Ending
Costs From Prior Department
Costs Incurred in this Department 33,329.56 = 5,690 x 5.857567
Materials 4,077.55 = 5,121 x 0.796241
Conversion 8,305.56 = 3,130 x 2.653534
Total Work in Process P 45,712.67

AVERAGE METHOD
DEPARTMENT 2
JOURNAL ENTRIES
Account Titles Debit Credit
1. Work in Process – Department 2 P 61,900
Materials Inventory P 14,200
Factory Payroll 18,000
Manufacturing Overhead 29,700
To record costs incurred during the month