Required: Prepare a process costing work sheet.

Organic Fertilizer Inc manufactures fertilizer using a three stage composting system which improves the nutrient content in the soils and provide greater yields. Process I involves mixing the inputs of organic and other inputs, Process 2 involves grinding the output from process 1 and adding stabilizing agents and Process 3 Packaging and Labeling for market. Composting material is added at various stages during process 1. The information presented below is for process 1. The organization uses the Weighted Average method for inventory valuation. Physical units Direct (kg) Materials Conversion Cost 50,000 $90,000 $125,000 Work in process July 01. Degree of completion materials 35%, conversion 50% Started in July Normal spoilage 4% of inputs in the month. Materials 50% and conversion 30% Good units completed and transferred out in July Work in process July 31. Degree of completion, materials 60,% conversion 40% Cost added during July Spoiled units are 80% complete as to materials and 75% conversion as a result of broken sewer line which contaminated the fertilizer. 500,000 ? 40,000 $ 1,050,000 $ 1,420,000 15,000