In: Accounting
Cost of Production Report
Hana Coffee Company roasts and packs coffee beans. The process begins by placing coffee beans into the Roasting Department. From the Roasting Department, coffee beans are then transferred to the Packing Department. The following is a partial work in process account of the Roasting Department at July 31:
ACCOUNT Work in Process—Roasting DepartmentACCOUNT NO.
DateItemDebitCreditBalance
DebitCredit
July1Bal., 4,800 units, 4/5 completed 18,336
31Direct materials, 216,000 units691,200 709,536
31Direct labor136,400 845,936
31Factory overhead34,096 880,032
31Goods transferred, 216,000 units ?
31Bal., ? units, 1/5 completed ?
Required:
1. Prepare a cost of production report, and identify the missing amounts for Work in Process—Roasting Department. If an amount is zero, enter "0". When computing cost per equivalent units, round to two decimal places.
Hana Coffee Company
Cost of Production Report-Roasting Department
For the Month Ended July 31
Unit Information
Units charged to production:
Inventory in process, July 1
Received from materials storeroom
Total units accounted for by the Roasting Department
Units to be assigned costs:
Equivalent Units
Whole UnitsDirect MaterialsConversion
Inventory in process, July 1
Started and completed in July
Transferred to Packing Department in July
Inventory in process, July 31
Total units to be assigned costs
Cost Information
Cost per equivalent unit:
Direct MaterialsConversion
Total costs for July in Roasting Department$$
Total equivalent units
Cost per equivalent unit$$
Costs assigned to production:
Direct MaterialsConversionTotal
Inventory in process, July 1$
Costs incurred in July
Total costs accounted for by the Roasting Department$
Costs allocated to completed and partially completed units:
Inventory in process, July 1 balance$
To complete inventory in process, July 1$$
Cost of completed July 1 work in process$
Started and completed in July
Transferred to Molding Department in July$
Inventory in process, July 31
Total costs assigned by the Roasting Department$
2. Assuming that the July 1 work in process inventory includes $14,880 of direct materials, determine the increase or decrease in the cost per equivalent unit for direct materials and conversion between February and July. If required, round your answers to the nearest cent.
Increase or DecreaseAmount
Change in direct materials cost per equivalent unit $
Change in conversion cost per equivalent unit $
Hana Coffee Company | ||||
Cost of Production Report-Roasting Department | ||||
For the Month Ended July 31 | ||||
Unit Information | ||||
Units charged to production: | ||||
Inventory in process, July 1 | 4800 | |||
Received from materials storeroom | 216000 | |||
Total units accounted for by the Roasting Department | 220800 | |||
Units to be assigned costs: | ||||
Equivalent Units | ||||
Whole Units | Direct Materials | Conversion | ||
Inventory in process, July 1 | 4800 | 0 | 960 | |
Started and completed in July | 211200 | 211200 | 211200 | |
Transferred to Packing Department in July | 216000 | 211200 | 212160 | |
Inventory in process, July 31 | 4800 | 4800 | 960 | |
Total units to be assigned costs | 220800 | 216000 | 213120 | |
Cost Information | ||||
Costs per equivalent unit: | ||||
Direct Materials | Conversion | |||
Total costs for July in Roasting Department | 691200 | 170496 | ||
Total equivalent units | 216000 | 213120 | ||
Cost per equivalent unit | 3.20 | 0.80 | ||
Costs charged to production: | ||||
Direct Materials | Conversion | Total | ||
Inventory in process, July 1 | 18336 | |||
Costs incurred in July | 861696 | |||
Total costs accounted for by the Roasting Department | 880032 | |||
Cost allocated to completed and partially completed units: | ||||
Inventory in process, July 1 balance | 18336 | |||
To complete inventory in process, July 1 | 0 | 768 | 768 | |
Cost of completed July 1 work in process | 19104 | |||
Started and completed in July | 675840 | 168960 | 844800 | |
Transferred to Packing Department in July | 863904 | |||
Inventory in process, July 31 | 15360 | 768 | 16128 | |
Total costs assigned by the Roasting Department | 880032 | |||
2 | ||||
Increase or Decrease | Amount | |||
Change in direct materials cost per equivalent unit | Increase | 0.10 | =3.2-(14880/4800) | |
Change in conversion cost per equivalent unit | Decrease | 0.10 | =0.8-((18336-14880)/(4800*4/5)) |