Fast Co. produces its product through two processing departments. Direct materials are added at the start of production in the Cutting department, and conversion costs are added evenly throughout each process. The company uses monthly reporting periods for its weighted-average process costing system. The Work in Process Inventory-Cutting account has a balance of $89,300 as of October 1, which consists of $18,600 of direct materials and $70,700 of conversion costs. During the month, the Cutting department incurred the following costs: Direct materials$141,150Conversion 915,400At the beginning of the month, 32,500 units were in process. During October, the company started 145,000 units and transferred 155,000 units to the Assembly department. At the end of the month, the Cutting department's work in process inventory consisted of 22,500 units that were 80% complete with respect to conversion costs. Required:
1. Prepare the company's process cost summary for October using the weighted-average method.
2. Prepare the journal entry dated October 31 to transfer the cost of the completed units to finished goods inventory

Part 1

Fast Co.

Process cost summary for October

Cost Summary :

Completed units to finished goods inventory = $1,023,000

Units in Ending Work In Process = $122,850

Part 2

Journal Entry to transfer the cost of the completed units to finished goods inventory

Debit  : Finished Goods $1,023,000

Credit : Assembly Department $1,023,000

Explanation:

It is important to note Fast Co.  uses  weighted-average method. This means we are only interested in the Equivalent units of units completed and transferred and units in Ending Work in Process.

Step 1 ; Calculate Equivalent Units of Production

Materials  = 155,000 x 100 % + 22,500 x 100 % = 177,500 units

Conversion Costs = 155,000 x 100 % + 22,500 x 80 % = 173,000 units

Step 2 : Calculate Total Cost of Materials and Conversion Cost

Materials = $18,600 + $141,150 = $159,750

Conversion Cost = $70,700 + $915,400 = $986,100

Step 3 : Calculate the Equivalent Cost per Unit

Materials = $159,750 ÷ 177,500 units = $0.90

Conversion Costs = $986,100 ÷ 173,000 units = $5.70

Total = $0.90 + $5.70 = $6.60

Step 4 : Cost of completed units to finished goods inventory

Completed units to finished goods inventory = $6.60 x 155,000 units

                                                                           = $1,023,000

Step 5 : Cost of units in Ending Work In Process

Units in Ending Work In Process = $0.90 x 22,500 + $5.70 x 18,000

                                                      = $122,850