Jolly Giant produces canned Italian green beans The green be

Jolly Giant produces canned Italian green beans. The green beans move through three departments: (1) Mixing, (2) Retort (sterilization), and (3) Packing. In the Mixing Department, green beans are added at the begin- ning of the process, the mixture is partly cooked, then chopped red pep- pers are added at the end of the process. Conversion costs are added evenly throughout the mixing process. April 2008 data from the Mixing Department are as follows: Tes ** Gallens Beginning work in process inventory Started production Completed and transferred out to Retort in April Costs Costs O gallons | Beginning work in process inventory 15,000 gallons Costs added during April Green beans 16,500 |12,900 gallons Red peppers 11,610 Conversion, costs (direct tabos $11,108 manufacturing overhead, $17,212) 28,320 | 2,100 gallons | Toral costs | $56,430 Ending work in process inventory (60% in of the way through the mixing- process) Requirements 1. Draw a time line for the Mixing Department. (pp. 1002-1003) 2. Use the time line to help you compute the equivalent units. (Hint: Each direct material added at a different point in the production process requires its own equivalent-unit computation.) (p. 1003) 3. Compute the total costs of the units (gallons) a. Completed and transferred out to the Retort Department (pp. 1004-1005) b. In the Mixing Department\'s ending work in process inventory (pp. 1004-1005) 4. Prepare the journal entry to record the cost of the gallons completed and transferred out to the Retort Department. (p. 1005) 5. Post the transactions to the Work in Process Inventory-Mixing T-account. What is the ending balance? (p. 1005) 6. What is the primary purpose of the work required in steps 1 through 32

Solution

1. Timeline of the mixing department:

2.

Equivalent units of production = 14160 units

3. Raw Materials are assumed to be completed in full.

Cost of raw material per unit of input = (16500+11610)/ 15000

= 1.874 per unit

Cost of overheads and labour since it is only 60% complete for 2100 units, we will divide by equivalent units

= 28320/14160

= 2 per unit

a.

Total cost of transfer to Retort Department = 49974.6

b.

6455.4

Total Cost of Work In Progress Inventory = 6455.4

Start with 15,000 gallons

Completed and transferred to Retort division (12900 ,100% complete)

Ending WIP 2100 gallons , 60% complete in all respects