Dover chemical company manufactures specialty chem…

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Dover chemical company manufactures specialty chem…

Equivalent units and related costs; cost of production report
Dover Chemical Company manufactures specialty chemicals by a series of three processes, all materials being introduced in the Distilling Department. From the Distilling Depart- ment, the materials pass through the Reaction and Filling departments, emerging as fin- ished chemicals.
The balance in the account Work in Process—Filling was as follows on January 1, 2016:
Work in Process—Filling Department (3,400 units, 60% completed):

Direct materials (3,400 × $9.58)

$32,572

Conversion (3,400 × 60% × $3.90)

     7,956

 

$40,528

The following costs were charged to Work in Process—Filling during January:
 
Direct materials transferred from Reaction
 

Department: 52,300 units at $9.50 a unit

$496,850

Direct labor

101,560

Factory overhead

95,166

During January, 53,000 units of specialty chemicals were completed. Work in Process— Filling Department on January 31 was 2,700 units, 30%   completed.
instructions
3.     Prepare a cost of production report for the Filling Department for January.
4.     Journalize the entries for costs transferred from Reaction to Filling and the costs trans- ferred from Filling to Finished Goods.
5.     Determine the increase or decrease in the cost per equivalent unit from December to January for direct materials and conversion costs.
6.                               Discuss the uses of the cost of production report and the results of part (3).
 

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