PROBLEM 18.8A Process Costing through Two Departments Wilson Dynamics makes flanges in a continuous prcxess through two departments: Forging and Assembly. All direct materials are added at the beginning of the process in the Forging Depart- ment, whereas all direct materials are added at the end of the process in the Assembly Department. Conversion costs are incurred uniformly over time in both departments. As units are completed in the Forging Department they are transferred to the Assembly Department. "Ille costs associated with the transferred units are included in the computation of the Assembly Department's total costs. The information presented tRIow was compiled at the end of July: Beginning Inventories (on July I): Physical units in producthn carried forward from June 30 ransferred Forging costs carried forward from June Direct materials costs caried forward from June 30 Conversion costs carried forward trom June 30 . Current Production (in July): units started during July . units in ending inventories as of July 31 Forging costs transferred to Assembly during July.. Direct materials costs incurred in July Conversion costs incurred in July . Percentage of Completion: Inventories with respect to conversion on July I Inventories with respect to conversion on July 31 Instructions Forging Depa rtment $ 45,000 16,000 75,000 $675,000 Assembly $ 68,000 3 ooo 16,000 S72Q000 191,400 a. b. Complete the following requirements for the Forging Department: Prepare a schedule showing units started and completed in the Forging Department dur- ing July. Compute the equivalent units of direct materials and conversion for the Forging Depart- ment in July. Determine the cost per equivalent unit of input resource for the Forging Department dur- ing July. Prepare the summary journal entry required to transfer units from the Forging Department to the Assembly Department during July. Compute the costs Issigned to ending inventory in the Forging Department on July 31. Complete the following requirements for the Assembly Department: Prepare a schedule showing units started and completed in the Assembly Department dur- ing July. Compute the equivalent units of direct materials and conversion for the Assembly Department in July. Direct materials include both those transferred in from the Forging Department and those added by the Assembly Department. Determine the cost per equivalent unit of input resource for the Assembly Department during July. Prepare the summary journal entry required to transfer units from the Assembly Depart- ment to Finished Goods Inventory during July. Compute the costs assigned to ending inventory in the Assembly Department on July 31.