Question

Azule Co. manufactures in two sequential processes, cutting and binding. The two departments report the information below for a recent month. Cutting Binding Beginning work in process Transferred in from cutting dept. $ 2,050 Direct materials $ 1,470 2,046 Conversion 3,600 4,350 Costs added during March Direct materials $ 10,240 $ 7,224 Conversion 17,250 19,925 Transferred in from cutting dept. 16,255 Transferred to finished goods 39,000 Determine the ending balances in the Work in Process Inventory accounts of each department.

Answer 1

The ending balances in the Work in Process Inventory accounts of each department are as follows:

Cutting = $16,305

Binding = $12,850

Step-by-step explanation:

The ending balances in the Work in Process Inventory accounts of each department can be calculated as follows:

Cutting = Cutting Beginning work in process of Direct materials + Cutting Beginning work in process of Conversion + Cutting Costs added during March in Direct materials + Cutting Costs added during March of conversion - Transferred in from cutting dept. = $1,470 + $3,600 + $10,240 + $17,250 - $16,255 = $16,305

Binding = Beginning work in process of Transferred in from cutting dept. + Binding Beginning work in process of Direct materials + Binding Beginning work in process of Conversion + Binding Costs added during March in Direct materials + Binding Costs added during March of conversion + Transferred in from cutting dept. - Transferred to finished goods = $2,050 + $2,046 + $4,350 + $7,224 + $19,925 + $16,255 - $39,000 = $12,850