Refer to Exercise 25. Prepare a production cost report for Jennings Company for the month of January using the format shown in Figure 4.9.

In exercise 25

Jennings Company uses the weighted average method for its process costing system. The Molding department at Jennings began January with 80,000 units in work-in-process inventory, all of which were completed and transferred out during January. An additional 90,000 units were started during the month, 30,000 of which were completed and transferred out during January. A total of 60,000 units remained in work-in-process inventory at the end of January and were at varying levels of completion, as shown in the following.

The following cost information is for the Molding department at Jennings Company for the month of January.

Required:

a. Determine the units to be accounted for and units accounted for; then calculate the equivalent units for direct materials, direct labor, and overhead. 

b. Calculate the cost per equivalent unit for direct materials, direct labor, and overhead. 

c. Assign costs to units transferred out and to units in ending WIP inventory. 

d. Confirm that total costs to be accounted for (from step 2) equals total costs accounted for (from step 4). Note that minor differences may occur due to rounding the cost per equivalent unit in step 3.

e. Explain the meaning of equivalent units.

Direct materials 80 percent complete | 90 percent complete 90 percent complete Direct labor Overhead Beginning WIP inventory Incurred during the month Direct Materials Direct Labor Overhead Total $1,400,000 $1,100,000 $1,700,000 $4,200,000 $980,000 $1,450,000 $3,640,000 $1,210,000