Question

Cost of Production Report

The debits to Work in Process—Roasting Department for Morning Brew Coffee Company for August, together with information concerning production, are as follows:

Work in process, August 1, 1,100 pounds, 30% completed				$4,422*
	*Direct materials (1,100 X $3.60)	$3,960
	Conversion (1,100 X 30% X $1.40)	462
		$4,422
Coffee beans added during August, 34,000 pounds				120,700
Conversion costs during August				50,265
Work in process, August 31, 1,800 pounds, 30% completed				?
Goods finished during August, 33,300 pounds				?

All direct materials are placed in process at the beginning of production.

a. Prepare a cost of production report, presenting the following computations:

1. Direct materials and conversion equivalent units of production for August
2. Direct materials and conversion costs per equivalent unit for August
3. Cost of goods finished during August
4. Cost of work in process at August 31

If an amount is zero, enter in "0". For the cost per equivalent unit, round your answer to two decimal places.

Morning Brew Coffee Company
Cost of Production Report-Roasting Department
For the Month Ended August 31
Unit Information
Units charged to production:
Inventory in process, August 1			fill in the blank eee2b2fd8fd0fc7_1
Received from materials storeroom			fill in the blank eee2b2fd8fd0fc7_2
Total units accounted for by the Roasting Department			fill in the blank eee2b2fd8fd0fc7_3
Units to be assigned costs:
		Equivalent Units
	Whole Units	Direct Materials (1)	Conversion (1)
Inventory in process, August 1	fill in the blank eee2b2fd8fd0fc7_4	fill in the blank eee2b2fd8fd0fc7_5	fill in the blank eee2b2fd8fd0fc7_6
Started and completed in August	fill in the blank eee2b2fd8fd0fc7_7	fill in the blank eee2b2fd8fd0fc7_8	fill in the blank eee2b2fd8fd0fc7_9
Transferred to finished goods in August	fill in the blank eee2b2fd8fd0fc7_10	fill in the blank eee2b2fd8fd0fc7_11	fill in the blank eee2b2fd8fd0fc7_12
Inventory in process, August 31	fill in the blank eee2b2fd8fd0fc7_13	fill in the blank eee2b2fd8fd0fc7_14	fill in the blank eee2b2fd8fd0fc7_15
Total units to be assigned costs	fill in the blank eee2b2fd8fd0fc7_16	fill in the blank eee2b2fd8fd0fc7_17	fill in the blank eee2b2fd8fd0fc7_18
Cost Information
Cost per equivalent unit:
		Direct Materials	Conversion
Total costs for August in Roasting Department		$fill in the blank eee2b2fd8fd0fc7_19	$fill in the blank eee2b2fd8fd0fc7_20
Total equivalent units		fill in the blank eee2b2fd8fd0fc7_21	fill in the blank eee2b2fd8fd0fc7_22
Cost per equivalent unit (2)		$fill in the blank eee2b2fd8fd0fc7_23	$fill in the blank eee2b2fd8fd0fc7_24
Costs assigned to production:
	Direct Materials	Conversion	Total
Inventory in process, August 1			$fill in the blank eee2b2fd8fd0fc7_25
Costs incurred in August			fill in the blank eee2b2fd8fd0fc7_26
Total costs accounted for by the Roasting Department			$fill in the blank eee2b2fd8fd0fc7_27
Costs allocated to completed and partially completed units:
Inventory in process, August 1 balance			$fill in the blank eee2b2fd8fd0fc7_28
To complete inventory in process, August 1	$fill in the blank eee2b2fd8fd0fc7_29	$fill in the blank eee2b2fd8fd0fc7_30	fill in the blank eee2b2fd8fd0fc7_31
Cost of completed August 1 work in process			$fill in the blank eee2b2fd8fd0fc7_32
Started and completed in August	fill in the blank eee2b2fd8fd0fc7_33	fill in the blank eee2b2fd8fd0fc7_34	fill in the blank eee2b2fd8fd0fc7_35
Transferred to finished goods in August (3)			$fill in the blank eee2b2fd8fd0fc7_36
Inventory in process, August 31 (4)	fill in the blank eee2b2fd8fd0fc7_37	fill in the blank eee2b2fd8fd0fc7_38	fill in the blank eee2b2fd8fd0fc7_39
Total costs assigned by the Roasting Department			$fill in the blank eee2b2fd8fd0fc7_40

b. Compute and evaluate the change in cost per equivalent unit for direct materials and conversion from the previous month (July). If required, round your answers to the nearest cent.

	Increase or Decrease	Amount
Change in direct materials cost per equivalent unit		$fill in the blank 02c6e3f9e042fd1_2
Change in conversion cost per equivalent unit		$fill in the blank 02c6e3f9e042fd1_4

Answer 1

Morning Brew Coffee Company
Cost of Production Report-Roasting Department
For the Month Ended August 31
Unit Information
Units charged to production:
Inventory in process, August 1			1100
Received from materials storeroom			34000
Total units accounted for by the Roasting Department			35100
Units to be assigned costs:
		Equivalent Units
	Whole Units	Direct Materials	Conversion
Inventory in process, August 1	1100	0	770
Started and completed in August	32200	32200	32200
Transferred to finished goods in August	33300	32200	32970
Inventory in process, August 31	1800	1800	540
Total units to be assigned costs	35100	34000	33510
Cost Information
Costs per equivalent unit:
		Direct Materials	Conversion
Total costs for August in Roasting Department		120700	50265
Total equivalent units		34000	33510
Cost per equivalent unit		3.55	1.50
Costs charged to production:
	Direct Materials	Conversion	Total
Inventory in process, August 1			4422
Costs incurred in August			170965
Total costs accounted for by the Roasting Department			175387
Cost allocated to completed and partially completed units:
Inventory in process, August 1 balance			4422
To complete inventory in process, August 1	0	1155	1155
Cost of completed August 1 work in process			5577
Started and completed in August	114310	48300	162610
Transferred to finished goods in August			168187
Inventory in process, August 31	6390	810	7200
Total costs assigned by the Roasting Department			175387
b
	Increase or Decrease	Amount
Change in direct materials cost per equivalent unit	Decrease	0.05	=3.60-3.55
Change in conversion cost per equivalent unit	Increase	0.10	=1.50-1.40