P7-4 (1) Billingsley Company Cutting Department Cost of Production Report For April Quantity Schedule

Materials Labor Overhead Quantity

Beginning inventory................................ 5,000

Started in process this period ............... 20,000 25,000

Transferred to Assembling Department 18,000

Ending inventory ..................................... 100% 60% 60% 4,000 Spoiled in process ..................................
100% 90% 90% 3,000 25,000 Cost Charged to Department Total Equivalent Unit Beginning inventory:
Cost Units* Cost** Materials ..................................................................................... $ 1,260
Labor .......................................................................................... 789 Factory
overhead....................................................................... 1,789 Total cost in beginning
inventory .................................... $ 3,838 Cost added during current period:
Materials ..................................................................................... $36,240 25,000 $1.50
Labor........................................................................................... 10,761 23,100 .50 Factory
overhead ...................................................................... 21,311 23,100 1.00 Total cost added during
current period............................ $68,312 Total cost charged to
department ................................................. $72,150 $3.00 Cost Accounted for as Follows Units %
Complete Unit Cost Total Cost Transferred to Assembling Department 18,000 100% $3.00 $54,000
Charge to Factory Overhead for spoilage: Materials ............................................ 3,000 100% $1.50 $4,500
Labor.................................................. 3,000 90% .50 1,350 Factory overhead.............................. 3,000
90% 1.00 2,700 8,550 Work in Process, ending inventory: Materials ............................................ 4,000
100% $1.50 $6,000 Labor ................................................. 4,000 60% .50 1,200 Factory
overhead.............................. 4,000 60% 1.00 2,400 9,600 Total cost accounted for ........................
$72,150 *Total number of equivalent units required in the cost accounted for section determined as
follows: Materials Labor Overhead Equivalent units transferred out......................... 18,000 18,000 18,000
Equivalent units in ending inventory ................. 4,000 2,400 2,400 Equivalent units
of ............................................... 3,000 2,700 2,700 Total equivalent units .........................................
25,000 23,100 23,100 ** Total cost (i.e., the cost in beginning inventory plus the cost added during the
current period) divided by the total number of equivalent units required in the cost accounted for
section 7-18 Chapter 7

19. P7-4 (Continued) Billingsley Company Assembling Department Cost of Production Report For April
Quantity Schedule Materials Labor Overhead Quantity Beginning inventory................................ 4,000
Received from Cutting Department....... 18,000 22,000 Transferred to Finished Goods Inventory 17,000
Ending inventory ..................................... 80% 20% 20% 4,000 Spoiled in process ..................................
100% 100% 100% 1,000 22,000 Cost Charged to Department Total Equivalent Unit Beginning inventory:
Cost Units* Cost** Cost from preceding department ........................................... $ 12,000
Materials ..................................................................................... 38,028
Labor........................................................................................... 3,356 Factory
overhead....................................................................... 5,034 Total cost in beginning
inventory...................................... $ 58,418 Cost added during current period: Cost from preceding
department ........................................... 54,000 22,000 $ 3.00
Materials ..................................................................................... 163,372 21,200 9.50
Labor........................................................................................... 15,444 18,800 1.00 Factory
overhead....................................................................... 23,166 18,800 1.50 Total cost added during
current period ........................... $255,982 Total cost charged to
department.................................................. $314,400 $15.00 Cost Accounted for as Follows Units %
Complete Unit Cost Total Cost Transferred to Finished Goods.............. 17,000 100% $15.00 $255,000
Transferred to Spoiled Goods Inventory at salvage value ................................ 1,000 $ 3.00 3,000 Charge
to Factory Overhead for spoilage: Cost of completed spoiled units..... 1,000 100% $15.00 $15,000 Less
salvage value of spoiled units 1,000 3.00 3,000 12,000 Work in Process, ending inventory: Cost from
preceding department.... 4,000 100% $3.00 $12,000 Materials ............................................ 4,000 80%
9.50 30,400 Labor.................................................. 4,000 20% 1.00 800 Factory
overhead.............................. 4,000 20% 1.50 1,200 44,400 Total cost accounted for.........................
$314,400 Chapter 7 7-19

20. P7-4 (Concluded) * Total number of equivalent units required in the cost accounted for section
determined as follows: Prior Dept. Cost Materials Labor Overhead Equivalent units transferred out .....
17,000 17,000 17,000 17,000 Equivalent units in ending inventory 4,000 3,200 800 800 Equivalent units
of spoilage............ 1,000 1,000 1,000 1,000 Total equivalent units ....................... 22,000 21,200 18,800
18,800 ** Total cost (i.e., the cost in beginning inventory plus the cost added during the current period)
divided by the total number of equivalent units required in the cost accounted for section (2) Work in
Process—Assembling Department .............. 54,000 Factory Overhead Control ...........................................
8,550 Work in Process—Cutting Department ............. 62,550 Finished Goods
Inventory ........................................... 255,000 Spoiled Goods Inventory.............................................
3,000 Factory Overhead Control ........................................... 12,000 Work in Process—Assembling
Department ..... 270,000 7-20 Chapter 7

21. P7-5 (1) Hulvey Brewery Company Mixing and Brewing Department Cost of Production Report For
January Quantity Schedule Materials Labor Overhead Quantity Beginning inventory................................
4,000 Started in process this period ............... 36,000 40,000 Transferred to Canning Department......
28,000 Ending inventory ..................................... 100% 40% 40% 6,000 Lost in
process ....................................... 6,000 40,000 Cost Charged to Department Total Equivalent Unit
Beginning inventory: Cost Units* Cost** Materials .....................................................................................
$ 600 Labor......................................................................................... 88 Factory
overhead....................................................................... 128 Total cost in beginning
inventory...................................... $ 816 Cost added during current period:
Materials ..................................................................................... $4,840 34,000 $.16
Labor........................................................................................... 824 30,400 .03 Factory
overhead....................................................................... 1,088 30,400 .04 Total cost added during current
period............................ $6,752 Total cost charged to department.................................................. $7,568
$.23 % Cost Accounted for as Follows Units Complete Unit Cost Total Cost Transferred to Canning
Department...... 28,000 100% $.23 $6,440 Work in Process, ending inventory:
Materials ............................................ 6,000 100% $.16 $960 Labor.................................................. 6,000
40% .03 72 Factory overhead.............................. 6,000 40% .04 96 1,128 Total cost accounted
for ........................ $7,568 *Total number of equivalent units required in the cost accounted for section
determined as follows: Materials Labor Overhead Equivalent units transferred out................................
28,000 28,000 28,000 Equivalent units in ending inventory........................ 6,000 2,400 2,400 Total
equivalent units ................................................. 34,000 30,400 30,400 ** Total cost (i.e., the cost in
beginning inventory plus the cost added during the current period) divided by the total number of
equivalent units required in the cost accounted for section Chapter 7 7-21

1. P7-5 (Continued) Hulvey Brewery Company Canning Department Cost of Production Report
For January Quantity Schedule Materials Labor Overhead Quantity Beginning
inventory................................ 2,000 Received from Mixing and Brewing
Department ........................ 28,000 30,000 Transferred to Finished Goods Inventory 25,000
Ending inventory ..................................... 100% 60% 60% 1,000 Spoiled in
process ................................. 100% 80% 80% 4,000 30,000 Cost Charged to Department
Total Equivalent Unit Beginning inventory: Cost Units* Cost** Cost from preceding
department............................................. $ 550
Materials .................................................................................... 190
Labor........................................................................................... 75 Factory
overhead....................................................................... 150 Total cost in beginning
inventory .................................... $ 965 Cost added during current period: Cost from
preceding department ........................................... $ 6,440 30,000 $.233
Materials .................................................................................... 1,520 30,000 .057
Labor .......................................................................................... 789 28,800 .030 Factory
overhead ...................................................................... 1,578 28,800 .060 Total cost added
during current period............................ $10,327 Total cost charged to
department.................................................. $11,292 $.380 % Cost Accounted for as Follows
Units Complete Unit Cost Total Cost Transferred to Finished Goods Inventory 25,000 100%
$.380 $ 9,500 Charge to Factory Overhead for spoilage: Cost from preceding department ...
4,000 100% $.233 $932 Materials ........................................... 4,000 100% .057 228
Labor ................................................. 4,000 80% .030 96 Factory
overhead ............................. 4,000 80% .060 192 1,448 Work in Process, ending inventory:
Cost from preceding department ... 1,000 100% $.233 $233
Materials ........................................... 1,000 100% .057 57
Labor ................................................. 1,000 60% .030 18 Factory
overhead.............................. 1,000 60% .060 36 344 Total cost accounted for.........................
$11,292 7-22 Chapter 7
2. 23. P7-5 (Concluded) *Total number of equivalent units required in the cost accounted for
section determined as follows: Prior Dept. Cost Materials Labor Overhead Equivalent units
transferred out ..... 25,000 25,000 25,000 25,000 Equivalent units in ending inventory 1,000
1,000 600 600 Equivalent units of spoilage............ 4,000 4,000 3,200 3,200 Total equivalent
units ....................... 30,000 30,000 28,800 28,800 ** Total cost (i.e., the cost in beginning
inventory plus the cost added during the current period) divided by the total number of
equivalent units required in the cost accounted for section (2) Work in Process—Canning
Department .................... 6,440 Work in Process—Mixing and Brewing
Department ................................. 6,440 Finished Goods
Inventory ........................................... 9,500 Factory Overhead
Control ........................................... 1,448 Work in Process—Canning Department ..........
10,948 Chapter 7 7-23
3. 24. P7-6 APPENDIX (1) Hadenville Tool Company Fabricating Department Cost of
Production Report For April Quantity Schedule Materials Labor Overhead Quantity Beginning
inventory................................ 100% 70% 70% 2,000 Started this
period .................................. 9,000 11,000 Transferred to Finishing Department.... 9,000
Ending inventory ..................................... 100% 40% 40% 1,500 Spoiled in
process .................................. 100% 60% 60% 500 11,000 Cost Charged to Department
 Total Equivalent Unit Beginning inventory: Cost Units* Cost**
Materials ..................................................................................... $ 1,900
Labor........................................................................................... 340 Factory
overhead....................................................................... 1,020 Total cost in beginning
inventory...................................... $ 3,260 Cost added during current period:
Materials ..................................................................................... $ 9,180 9,000 $1.02
Labor .......................................................................................... 2,125 8,500 .25 Factory
overhead ...................................................................... 6,375 8,500 .75 Total cost added
during current period............................ $17,680 Total cost charged to
department ................................................. $20,940 $2.02 7-24 Chapter 7
4. 25. P7-6 APPENDIX (Continued) Cost Accounted for as Follows Units Current % Unit Cost
Total Cost Transferred to Finishing Department: From beginning inventory .............. $3,260
Cost to complete this period: Labor..................................... 2,000 30% $ .25 150 Factory
overhead................. 2,000 30% .75 450 $ 3,860 Started and completed this period . 7,000
100% $2.02 14,140 Total cost transferred to Finishing Department ................................
$18,000 Charge to Factory Overhead for spoilage: Materials ............................................ 500
100% $1.02 $ 510 Labor.................................................. 500 60% .25 75 Factory
overhead ............................. 500 60% .75 225 810 Work in Process, ending inventory:
Materials ........................................... 1,500 100% $1.02 $1,530
Labor.................................................. 1,500 40% .25 150 Factory
overhead.............................. 1,500 40% .75 450 2,130 Total cost accounted
for ........................ $20,940 *Number of equivalent units of cost added during the current
period determined as follows: Materials Labor Overhead To complete beginning
inventory....................... 0 600 600 Started and completed this period..................... 7,000
7,000 7,000 Ending inventory.................................................. 1,500 600 600 Spoiled
units ........................................................ 500 300 300 Total equivalent
units ......................................... 9,000 8,500 8,500 ** Cost added during the current period
divided by the number of equivalent units of cost added dur- ing the current period Chapter 7
7-25
5. 26. P7-6 APPENDIX (Continued) Hadenville Tool Company Finishing Department Cost of
Production Report For April Quantity Schedule Materials Labor Overhead Quantity Beginning
inventory................................ 100% 40% 40% 3,000 Received from Fabricating Department
9,000 12,000 Transferred to Finished Goods.............. 9,900 Ending
inventory ..................................... 100% 60% 60% 2,000 Spoiled in
process .................................. 100% 100% 100% 100 12,000 Cost Charged to Department
Total Equivalent Unit Beginning inventory: Cost Units* Cost** Cost from preceding
department............................................. $ 6,100
Materials ..................................................................................... 3,500
Labor .......................................................................................... 520 Factory
overhead....................................................................... 780 Total cost in beginning
inventory...................................... $10,900 Cost added during current period: Cost from
preceding department............................................. $18,000 9,000 $2.00
Materials ..................................................................................... 10,800 9,000 1.20
Labor .......................................................................................... 4,000 10,000 .40 Factory
overhead....................................................................... 6,000 10,000 .60 Total cost added
during current period............................ $38,800 Total cost charged to
department ................................................. $49,700 $4.20 7-26 Chapter 7
6. 27. P7-6 APPENDIX (Concluded) Cost Accounted for as Follows Units Current % Unit Cost
Total Cost Transferred to Finished Goods: From beginning inventory .............. $10,900 Cost
to complete this period: Labor..................................... 3,000 60% $ .40 720 Factory
overhead................. 3,000 60% .60 1,080 $12,700 Started and completed this period . 6,900
100% $4.20 28,980 Total cost transferred to Finished Goods $41,680 Transferred to Spoiled
Goods Inventory at salvage value ............................... 100 $1.00 100 Charge to Factory
Overhead for spoilage: Cost of completed spoiled units..... 100 100% $4.20 $ 420 Less
salvage value of spoiled units 100 1.00 100 320 Work in Process, ending inventory Cost
from preceding department.... 2,000 100% $2.00 $ 4,000
Materials ............................................ 2,000 100% 1.20 2,400
Labor.................................................. 2,000 60% .40 480 Factory
overhead.............................. 2,000 60% .60 720 7,600 Total cost accounted
for ........................ $49,700 * Number of equivalent units of cost added during the current
period determined as follows: Prior Dept. Cost Materials Labor Overhead To complete
beginning inventory ... 0 0 1,800 1,800 Started and completed this period . 6,900 6,900
6,900 6,900 Ending inventory............................... 2,000 2,000 1,200 1,200 Spoiled
units ..................................... 100 100 100 100 Total equivalent units ....................... 9,000
9,000 10,000 10,000 ** Cost added during the current period divided by the number of
equivalent units of cost added dur- ing the current period (2) Work in Process—Finishing
Department................... 18,000 Factory Overhead Control ........................................... 810
Work in Process—Fabricating Department ...... 18,810 Finished Goods
Inventory ........................................... 41,680 Spoiled Goods
Inventory............................................. 100 Factory Overhead
Control ........................................... 320 Work in Process—Finishing Department..........
42,100 Chapter 7 7-27