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, 700 pounds, 20% completed				$ 3,479*
	*Direct materials (700 X $4.70)	$3,290
	Conversion (700 X 20% X $1.35)	189
		$3,479
Coffee beans added during August, 14,300 pounds				65,780
Conversion costs during August				21,942
Work in process, August 31, 400 pounds, 42% completed				?
Goods finished during August, 14,600 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 the nearest cent.

Answer 1

Cost of production report

	Physical units	Materials	Conversion
Units account for
Inventory in process, August 1	700
Units started	14,300
Total units account for	15,000
Units account for:
Inventory in process	700	0	560
Started and completed	13,900	13,900	13,900
Transferred to Finished goods	14,600	13,900	14,460
Inventory in process	400	400	168
Total units account for	15,000	14,300	14,628

Cost per equivalent unit

Total costs	$65,780	$21,942
Equivalent units of production	14,300	14,628
Cost per equivalent unit	$4.60	$1.5

Cost assigned to production

	Materials	Conversion	Total
Inventory in process, August 1			$3,479
Costs incurred in August			$87,722
Total cost accounted for			$91,201
Costs allocated to completed and partially completed units:
Inventory in process			$3,479
To complete inventory in process, August 1	$0	$840	$840
Cost of completed August 1 work-in-process			$4,319
Started and completed in August	$63,940	$20,850	$84,700
Transferred to Finished goods			$89,109
Inventory in process	$1,840	$252	$2,092
Total cost account for			$91,201

____×____

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