You're an Artist prepares and packages paint products. You're an Artist has two departments: Blending and...

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You're an Artist prepares and packages paint products. You're an Artist has two departments: Blending and Packaging. Direct materials are added at the beginning of the blending process (dyes) and at the end of the packaging process (cans). Data from the month of May for the Blending Department are as follows: (Click the icon to view the data from May.) You're an Artist completed the following production cost report for its Blending Department for the month of May: (Click the icon to view the assignment of costs.) Conversion costs are added evenly throughout each process. The company uses the weighted average method. Read the remene Gallons You're an Artist Beginning Work-in-Process Inventory 0 gallons Production Cost Report - Blending Department (Partial) Started in production 9,900 gallons Completed and transferred out to Packaging in May 5,800 gallons Ending Work-in-Process Inventory (30% of the way through the blending process) COSTS Month Ended May 31 Direct Materials Conversion Costs Total Costs 4,100 gallons Costs to account for: Costs Beginning Work-in-Process Inventory $ 0 Beginning work-in-process $ 0 $ 0 $ 0 Costs added during May: Costs added during the period 4,950 2,812 7,762 Direct materials 4,950 Total costs to account for 4,950 2,812 7,762 Direct labor 1,912 9,900 Divided by: Total EUP 7,030 900 Manufacturing overhead allocated $ 0.50 $ 0.40 Cost per equivalent unit $ 7,762 Total costs added during May Requirements Costs accounted for: Completed and transferred out $ 2,900 $ 2,320 $ 5,220 Ending work-in-process 2,050 492 2,542 $ 4,950 $ 2,812 $ 7,762 il costs accounted for 1. Prepare the journal entries to record the assignment of direct materials and direct labor and the allocation of manufacturing overhead to the Blending Department. Also, prepare the journal entry to record the costs of the gallons completed and transferred out to the Packaging Department. Assume labor costs are accrued and not yet paid. 2. Post the journal entries to the Work-in-Process Inventory-Blending T-account. What is the ending balance? 3. What is the average cost per gallon transferred out of the Blending Department into the Packaging Department? Why would the company managers want to know this cost? Requirement 1. Prepare the journal entries to record the assignment of direct materials and direct labor and the allocation of manufacturing overhead to the Blending Department. Also, prepare the journal entry to record the costs of the gallons completed and transferred out to the Packaging Department. Assume labor costs are accrued and not yet paid. (Record debits first, then credits. Exclude explanations from any journal entries.) Begin with the journal entry to record the assignment of direct materials to the Blending Department. Do not record the assignment of direct labor or the allocation of manufacturing overhead with this entry. We will prepare those entries separately in the following steps. Date May 31 Accounts Debit Credit Prepare the journal entry to record the assignment of direct labor to the Blending Department. Assume labor costs are accrued and not yet paid. Accounts Debit Credit Date May 31 Prepare the journal entry for the allocation of manufacturing overhead to the Blending Department. Date May 31 Accounts Debit Credit Next, prepare the journal entry to record the costs of the gallons completed and transferred out to the Packaging Department. Date Credit Accounts Debit May 31 Requirement 2. Post the journal entries to the Work-in-Process Inventory-Blending T-account. What is the ending balance? Post the entries using the appropriate descriptions as posting references. Denote the ending balance as "Bal." Work-in-Process Inventory-Blending Beg. Bal. 0 quirement 3. What is the average cost per gallon transferred out of the Blending Department into the Packaging Department? Why would the company managers want to know this cost? termine the formula, then enter the amounts to calculate the average cost per gallon transferred out of the Blending Department. (Round your answer to the nearest cent.) Average cost per gallon hy would the company managers want to know this cost? A. Managers use the cost per gallon for external financial reporting-specifically to calculate the ending inventory balances on the Balance Sheet B. Managers use the cost per gallon for external financial reporting-specifically to calculate the Cost of Goods Sold on the Income Statement. C. Managers would compare the average cost per gallon against their budgeted costs to determine whether the costs of the blending process remain under control. If budgeted costs are higher than the actual average cost per gallon, then the managers have done a good job controlling costs. In contrast, if the budgeted costs are lower than the actual average cost per gallon, managers will investigate the reason for the higher-than-expected costs in an effort to regain control over costs. D. All of the above are reasons why management would be interested in this cost per unit for gallons completed and transferred out to Finished Goods Inventory. You're an Artist prepares and packages paint products. You're an Artist has two departments: Blending and Packaging. Direct materials are added at the beginning of the blending process (dyes) and at the end of the packaging process (cans). Data from the month of May for the Blending Department are as follows: (Click the icon to view the data from May.) You're an Artist completed the following production cost report for its Blending Department for the month of May: (Click the icon to view the assignment of costs.) Conversion costs are added evenly throughout each process. The company uses the weighted average method. Read the remene Gallons You're an Artist Beginning Work-in-Process Inventory 0 gallons Production Cost Report - Blending Department (Partial) Started in production 9,900 gallons Completed and transferred out to Packaging in May 5,800 gallons Ending Work-in-Process Inventory (30% of the way through the blending process) COSTS Month Ended May 31 Direct Materials Conversion Costs Total Costs 4,100 gallons Costs to account for: Costs Beginning Work-in-Process Inventory $ 0 Beginning work-in-process $ 0 $ 0 $ 0 Costs added during May: Costs added during the period 4,950 2,812 7,762 Direct materials 4,950 Total costs to account for 4,950 2,812 7,762 Direct labor 1,912 9,900 Divided by: Total EUP 7,030 900 Manufacturing overhead allocated $ 0.50 $ 0.40 Cost per equivalent unit $ 7,762 Total costs added during May Requirements Costs accounted for: Completed and transferred out $ 2,900 $ 2,320 $ 5,220 Ending work-in-process 2,050 492 2,542 $ 4,950 $ 2,812 $ 7,762 il costs accounted for 1. Prepare the journal entries to record the assignment of direct materials and direct labor and the allocation of manufacturing overhead to the Blending Department. Also, prepare the journal entry to record the costs of the gallons completed and transferred out to the Packaging Department. Assume labor costs are accrued and not yet paid. 2. Post the journal entries to the Work-in-Process Inventory-Blending T-account. What is the ending balance? 3. What is the average cost per gallon transferred out of the Blending Department into the Packaging Department? Why would the company managers want to know this cost? Requirement 1. Prepare the journal entries to record the assignment of direct materials and direct labor and the allocation of manufacturing overhead to the Blending Department. Also, prepare the journal entry to record the costs of the gallons completed and transferred out to the Packaging Department. Assume labor costs are accrued and not yet paid. (Record debits first, then credits. Exclude explanations from any journal entries.) Begin with the journal entry to record the assignment of direct materials to the Blending Department. Do not record the assignment of direct labor or the allocation of manufacturing overhead with this entry. We will prepare those entries separately in the following steps. Date May 31 Accounts Debit Credit Prepare the journal entry to record the assignment of direct labor to the Blending Department. Assume labor costs are accrued and not yet paid. Accounts Debit Credit Date May 31 Prepare the journal entry for the allocation of manufacturing overhead to the Blending Department. Date May 31 Accounts Debit Credit Next, prepare the journal entry to record the costs of the gallons completed and transferred out to the Packaging Department. Date Credit Accounts Debit May 31 Requirement 2. Post the journal entries to the Work-in-Process Inventory-Blending T-account. What is the ending balance? Post the entries using the appropriate descriptions as posting references. Denote the ending balance as "Bal." Work-in-Process Inventory-Blending Beg. Bal. 0 quirement 3. What is the average cost per gallon transferred out of the Blending Department into the Packaging Department? Why would the company managers want to know this cost? termine the formula, then enter the amounts to calculate the average cost per gallon transferred out of the Blending Department. (Round your answer to the nearest cent.) Average cost per gallon hy would the company managers want to know this cost? A. Managers use the cost per gallon for external financial reporting-specifically to calculate the ending inventory balances on the Balance Sheet B. Managers use the cost per gallon for external financial reporting-specifically to calculate the Cost of Goods Sold on the Income Statement. C. Managers would compare the average cost per gallon against their budgeted costs to determine whether the costs of the blending process remain under control. If budgeted costs are higher than the actual average cost per gallon, then the managers have done a good job controlling costs. In contrast, if the budgeted costs are lower than the actual average cost per gallon, managers will investigate the reason for the higher-than-expected costs in an effort to regain control over costs. D. All of the above are reasons why management would be interested in this cost per unit for gallons completed and transferred out to Finished Goods Inventory.

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