Question

Cost of Production Report: Average Cost Method

Sunrise Coffee Company roasts and packs coffee beans. The process begins in the Roasting Department. From the Roasting Department, the coffee beans are transferred to the Packing Department. The following is a partial work in process account of the Roasting Department at December 31:

ACCOUNT Work in Process-Roasting Department					ACCOUNT NO.
Date		Item	Debit		Credit	Balance
						Debit		Credit
Dec.	1	Bal., 16,500 units, 25% completed				67,155
	31	Direct materials, 285,500 units	659,505			726,660
	31	Direct labor	375,131			1,101,791
	31	Factory overhead	539,821.5			1,641,612.5
	31	Goods transferred, 287,900 units			?	?
	31	Bal., ? units, 75% completed				?

Required:

Prepare a cost of production report, using the average cost method, and identify the missing amounts for Work in Process—Roasting Department. If required, round your cost per equivalent unit answer to two decimal places.

Answer 1

unit information
inventory in process,december 1				16,500
received from materials storeroom				285,500
total units accounted for				302,000
				Whole	Equivalent units
				units	of production
units to be assigned costs
transferred to packing department				287,900	287,900
inventory in process,december31				14,100	10575
total units to be assinged costs				302,000	298,475
Cost Information
Unit costs:
				costs
total costs for december in roasting deptt				1,641,612.5
total equivalent units				298,475.0
cost per equivalent units				5.5
Costs charged to production:
inventory in process,december 1				67,155.0
costs incurred in december				1,574,457.5
total costs accounted for by roasting deptt				1,641,612.5
costs allocated to completed &partially
transferred to packing deptt in december				1583450
inventory in process,december 31				58162.5
total costs assigned by roasting deptt				1641612.5