Process Costing - Packaging Department

Direct materials are added 90% at the beginning of the process and the remaining 10% are added when the cookies are 80% complete with the packaging process.Direct labor and overhead are added evenly throughout the process.

Table 8 - Unit and cost information

		Cost
	Physical Units	Transferred-in	Direct Materials	Direct Labor	Overhead
Beg WIP	12,000 (40% complete)	$104,000	$10,350	$1,669.30	$78.20
Transferred In	160,000	$1,327,040
End WIP	10,000 (30% complete)

Added during Qtr 2:

Direct Materials -- $126,450

Direct Labor - 3,150 hrs @ $18.50 per hour

Overhead - OH is applied based on predetermined OH rate and actual DL hours

1. Determine the number of units completed during quarter 2.
2. Compute the equivalent units using the weighted average method.
3. Compute the cost per equivalent unit using the weighted average method
4. Compute the cost of goods transferred to finished goods inventory
5. Compute the ending balance in WIP, Packaging

Predetermined OH rate= $0.85 per DL hour

Actual DL hours= 221,800 hours