Exercise 4-1 (20 minutes)

a. To record issuing raw materials for use in production:

Work in ProcessMolding Department ........
28,000
Work in ProcessFiring Department ............
5,000
Raw Materials ......................................

33,000

b. To record direct labour costs incurred:

Work in ProcessMolding Department ........
Work in ProcessFiring Department ............
Wages Payable ....................................

18,000
5,000

23,000

c. To record applying manufacturing overhead:

Work in ProcessMolding Department ........
Work in ProcessFiring Department ............
Manufacturing Overhead ......................

24,000
37,000
61,000

d. To record transfer of unfired, molded bricks from the Molding Department to the Firing Department:
Work in ProcessFiring Department ............
67,000
Work in ProcessMolding Department ..
67,000
e. To record transfer of finished bricks from the Firing Department to the
finished goods warehouse:
Finished Goods ..........................................
108,000
Work in ProcessFiring Department .....
108,000
f. To record Cost of Goods Sold:
Cost of Goods Sold .....................................
Finished Goods ....................................

106,000
106,000

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Solutions Manual, Chapter 4

Exercise 4-4 (10 minutes)

Weighted-Average Method

Ending work in process inventory:

Equivalent units of production .................

Cost per equivalent unit ..........................
Cost of ending work in process inventory .

Units completed and transferred out:

Units transferred to the next department..

Cost per equivalent unit ..........................
Cost of units completed and transferred
out ....................................................

Materials Conversion

Total

300
$31.56
$9,468

100
$9.32
$932 $10,400

1,300
$31.56

1,300
$9.32

$41,028

$12,116 $53,144

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6

Managerial Accounting, 8th Canadian Edition

Problem 4-19 (45 minutes)

Weighted-Average Method
1. Equivalent Units of Production
Transferred to next department.......................
Ending work in process:
Materials: 80,000 units 75% complete .......
Conversion: 80,000 units 25% complete ....
Equivalent units of production.........................
2. Cost per Equivalent Unit
Cost of beginning work in process ................
Cost added during the period.......................
Total cost (a) ..............................................
Equivalent units of production (b) ................
Cost per equivalent unit, (a) (b) ...............

Materials Conversion
450,000

60,000
510,000

450,000

20,000
470,000

Materials Conversion
$ 36,550
391,850
$428,400
510,000
$0.84

$ 13,500
267,300
$280,800
470,000
$0.597*

*rounded
3.

Applying Costs to Units

Materials Conversion

Ending work in process inventory:

Equivalent units of production
(materials: 80,000 units 75%
complete; conversion: 80,000
units 25% complete) ......
60,000
Cost per equivalent unit .......
$0.84
Cost of ending work in process
inventory ..........................
$50,400
Units completed and transferred out:
Units transferred to the next
department .......................
450,000
Cost per equivalent unit .......
$0.84
Cost of units completed and
transferred out ..................
$378,000

Total

20,000
$0.597
$11,940

$62,340

450,000
$0.597
$268,650

$646,650

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22

Managerial Accounting, 8th Canadian Edition

Problem 4-19 (continued)

4. Cost Reconciliation
Costs to be accounted for:
Cost of beginning work in process inventory
($36,550 + $13,500) ................................
Costs added to production during the period
($391,850 + $267,300) .............................
Total cost to be accounted for......................
Costs accounted for as follows:
Cost of ending work in process inventory......
Cost of units completed and transferred out..
Total cost accounted for ..............................

$ 50,050
659,150
$709,200
$ 62,340
646,650
$708,990*

*off $210 due to rounding

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Solutions Manual, Chapter 4

23

Problem 4-21 (45 minutes)

Weighted-Average Method
1. Equivalent Units of Production
Transferred to next department*.....................
Ending work in process:
Materials: 40,000 units 75% complete .......
Conversion: 40,000 units 25% complete ....
Equivalent units of production.........................

Materials Conversion
380,000

30,000
410,000

380,000

10,000
390,000

*Units transferred to the next department = Units in beginning work in

process + Units started into production Units in ending work in
process = 70,000 + 350,000 40,000 = 380,000
2. Cost per Equivalent Unit
Cost of beginning work in process ................
Cost added during the period.......................
Total cost (a) ..............................................
Equivalent units of production (b) ................
Cost per equivalent unit, (a) (b) ...............

Materials Conversion
$ 86,000
447,000
$533,000
410,000
$1.30

$ 36,000
198,000
$234,000
390,000
$0.60

3. Cost of Ending Work in Process Inventory and Units Transferred Out

Materials Conversion

Ending work in process inventory:

Equivalent units of production
(materials: 40,000 units 75%
complete; conversion: 40,000
units 25% complete) ......
30,000
Cost per equivalent unit .......
$1.30
Cost of ending work in process
inventory ..........................
$39,000
Units completed and transferred out:
Units transferred to the next
department .......................
380,000
Cost per equivalent unit .......
$1.30
Cost of units completed and
transferred out ..................
$494,000

Total

10,000
$0.60
$6,000

$45,000

380,000
$0.60
$228,000

$722,000

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26

Managerial Accounting, 8th Canadian Edition

Problem 4-21 (continued)

4. Cost Reconciliation
Costs to be accounted for:
Cost of beginning work in process inventory
($86,000 + $36,000) ................................
Costs added to production during the period
($447,000 + $198,000) .............................
Total cost to be accounted for......................
Costs accounted for as follows:
Cost of ending work in process inventory......
Cost of units completed and transferred out..
Total cost accounted for ..............................

$122,000
645,000
$767,000
$ 45,000
722,000
$767,000

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Solutions Manual, Chapter 4

27