Process Costing: Average Costing Method

Many of the products made by Wireless Plastics Company are standard telephone replacement parts that require long production runs and are produced continuously. A unit for Wireless Plastics is a box of parts. During April, direct materials for 25,250 units were put into production. Total cost of direct materials used during April was $2,273,000. Direct labor costs totaled $1,135,000, and overhead was $2,043,000. The beginning work in process inventory contained 1,600 units, which were 100 percent complete for direct materials costs and 60 percent complete for conversion costs. Costs attached to the units in beginning inventory totaled $232,515, which included $143,500 of direct materials costs. At the end of the month, 1,250 units were in ending inventory; all direct materials had been added, and the units were 70 percent complete for conversion costs.


1. Using the average costing method and assuming no loss due to spoilage, prepare a process cost report for April. If an amount box does not require an entry, enter “0”. Round your answers to the nearest dollar, except for per unit amounts. For per unit amounts, round to two decimal places. For the percentages, do not enter the percent sign. For example, 60% would be entered as 60.

2. From the information in the process cost report, identify the amount that should be transferred out of the Work in Process Inventory account. State where those dollars should be transferred.