Question

Chill SpringsChill Springs produces premium bottled water. In the Bottling? Department, workers bottle the filtered water and pack the bottles into boxes. Conversion costs are incurred evenly throughout the bottling? process, but packaging materials are not added until the end of the process. February data from the Bottling Department? follow:

Costs in beginning work			Costs added
in process inventory			during February
Transferred in	$980		Transferred in*	$133,000
Direct materials	0		Direct materials	32,130
Direct labour	620		Direct labour	33,200
Manufacturing overhead	776		Manufacturing overhead	22,310
Total beginning work in process			Total costs added
inventory as of February 1	$2,376		during February	$220,640
*The Filtration Department completed and transferred out 153,000 litres at a total cost of $133,000.

Chill Springs
Bottling Department
Assignment of Costs
		Transferred-in			Direct			Conversion
	Assign costs:	Costs			Materials			Costs				Total
	Completed and transferred out	153,000	x (	$0.87	+		$0.21	+		$0.37	)	$221,850
	Ending work in process inventory:
	Transferred-in costs	1,000	x	$0.87								870
	Direct materials				0	x	$0.21					0
	Conversion costs							800	x	$0.37		296
	Total ending work in process inventory											1,166
	Total costs accounted for											$223,016

Requirement 1. Prepare the journal entry to record the cost of units completed and transferred to finished goods. ?(Record debits? first, then credits. Explanations are not? required.)

??

Journal Entry
Date		Accounts	Debit	Credit

Requirement 2. Post all transactions to the? "Work in Process

Inventorylong dash—?Bottling"

?T-account and determine the ending balance. ?(Leave any unused cells? blank.)

Work in Process Inventory—Bottling
Bal. February 1
Bal. February 28

Answer 1

Solution 1:

Journal Entries - Chill Springs
Date	Particulars	Debit	Credit
28-Feb	Finished goods inventory Dr	$221,850.00
	To Work In Process - Bottling		$221,850.00
	(Being cost of completed units in bottling transferred to finished goods inventory)

Solution 2:

Work in Process Inventory—Bottling
Particulars	Debit	Particulars	Credit
Bal. February 1	$2,376.00	Finished goods	$221,850.00
Transferred in - Filtration	$133,000.00
Direct material	$32,130.00
Direct labor	$33,200.00
Manufacturing overhead	$22,310.00
Bal. February 28	$1,166.00