Kao Tiles, Inc is a specialized producer of ceramic tiles. Their production process involves highly skilled workers and top quaiilty ceamic craftsmen. Work in Process is relatively large because each tile is in process for up to three weeks because of art, mold work and drying time. October began with 4000 units (a unit is one ceramic tile) in process, on average 65 percent complete as to direct materials and 35 percent complete as to conversion costs; 5000 of 6000 units that were on average 50 percent complete as to direct materials and 25 percent complete as to conversion costs.

Cost information Beg. WIP Costs added in October
Direct material 150,000 $230,000
Direct labor $140,000 $580,000
Manuf. Overhead 30,000 63,000

Prepare a production cost report for the month of October

Prepare the journal entry to recognize the transfer of the units completed and transferred to finished goods during October

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