Question

Cost of Production Report

Venus Chocolate Company processes chocolate into candy bars. The process begins by placing direct materials (raw chocolate, milk, and sugar) into the Blending Department. All materials are placed into production at the beginning of the blending process. After blending, the milk chocolate is then transferred to the Molding Department, where the milk chocolate is formed into candy bars. The following is a partial work in process account of the Blending Department at March 31, 2016:

ACCOUNT Work in Process—Blending Department							ACCOUNT NO.
Date		Item	Debit		Credit		Balance
							Debit		Credit
Mar.	1	Bal., 4,800 units, 1/5 completed					10,752
	31	Direct materials, 192,000 units	422,400				433,152
	31	Direct labor	92,500				525,652
	31	Factory overhead	23,180				548,832
	31	Goods transferred, 193,000 units			?
	31	Bal., ? units, 1/5 completed					?

Required:

1. Prepare a cost of production report, and identify the missing amounts for Work in Process—Blending Department. If an amount is zero, enter "0". When computing cost per equivalent units, round to two decimal places.

Venus Chocolate Company
Cost of Production Report-Blending Department
For the Month Ended March 31, 2016
Unit Information
Units charged to production:
Inventory in process, March 1
Received from materials storeroom
Total units accounted for by the Blending Department
Units to be assigned costs:
		Equivalent Units
	Whole Units	Direct Materials	Conversion
Inventory in process, March 1
Started and completed in March
Transferred to Molding Department in March
Inventory in process, March 31
Total units to be assigned costs
Cost Information
Costs per equivalent unit:
		Direct Materials	Conversion
Total costs for March in Blending Department		$	$
Total equivalent units
Cost per equivalent unit		$	$
Costs charged to production:
	Direct Materials	Conversion	Total
Inventory in process, March 1			$
Costs incurred in March
Total costs accounted for by the Blending Department			$
Cost allocated to completed and partially completed units:
Inventory in process, March 1 balance			$
To complete inventory in process, March 1	$	$
Cost of completed March 1 work in process			$
Started and completed in March
Transferred to Molding Department in March			$
Inventory in process, March 31
Total costs assigned by the Blending Department			$

2. Assuming that the March 1 work in process inventory includes $10,080 of direct materials, determine the increase or decrease in the cost per equivalent unit for direct materials and conversion between February and March. If required, round your answers to the nearest cent.

	Increase or Decrease	Amount
Change in direct materials cost per equivalent unit		$
Change in conversion cost per equivalent unit		$

Answer 1

Venus Chocolate Company
Cost of Production Report-Blending Department
For the Month Ended March 31, 2016
Unit Information
Units charged to production:
Inventory in process, March 1			4800
Received from materials storeroom			192000
Total units accounted for by the Blending Department			196800
Units to be assigned costs:
		Equivalent Units
	Whole Units	Direct Materials	Conversion
Inventory in process, March 1	4800	0	3840
Started and completed in March	188200	188200	188200
Transferred to Packing Department in March	193000	188200	192040
Inventory in process, March 31	3800	3800	760
Total units to be assigned costs	196800	192000	192800
Cost Information
Costs per equivalent unit:
		Direct Materials	Conversion
Total costs for March in Blending Department		422400	115680
Total equivalent units		192000	192800
Cost per equivalent unit		2.2	0.6
Costs charged to production:
	Direct Materials	Conversion	Total
Inventory in process, March 1			10752
Costs incurred in March			538080
Total costs accounted for by the Blending Department			548832
Cost allocated to completed and partially completed units:
Inventory in process, March 1 balance			10752
To complete inventory in process, March 1	0	2304	2304
Cost of completed March 1 work in process			13056
Started and completed in March	414040	112920	526960
Transferred to Packing Department in March			540016
Inventory in process, March 31	8360	456	8816
Total costs assigned by the Blending Department			548832
2
	Increase or Decrease	Amount
Change in direct materials cost per equivalent unit	Increase	0.1	=2.2-(10080/4800)
Change in conversion cost per equivalent unit	Decrease	0.1	=((10752-10080)/960)-0.6