Question

5. 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, 500 pounds, 40% completed				$2,080*
   	*Direct materials (500 X $3.6)	$1,800
   	Conversion (500 X 40% X $1.4)	$280
   		$2,080
   Coffee beans added during August, 16,000 pounds				56,800
   Conversion costs during August				23,730
   Work in process, August 31, 800 pounds, 40% completed				?
   Goods finished during August, 15,700 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
   Received from materials storeroom
   Total units accounted for by the Roasting Department
   Units to be assigned costs:
   		Equivalent Units
   	Whole Units	Direct Materials (1)	Conversion (1)
   Inventory in process, August 1
   Started and completed in August
   Transferred to finished goods in August
   Inventory in process, August 31
   Total units to be assigned costs
   Cost Information
   Costs per equivalent unit:
   		Direct Materials	Conversion
   Total costs for August in Roasting Department		$	$
   Total equivalent units
   Cost per equivalent unit (2)		$	$
   Costs assigned to production:
   	Direct Materials	Conversion	Total
   Inventory in process, August 1			$
   Costs incurred in August
   Total costs accounted for by the Roasting Department			$
   Costs allocated to completed and partially completed units:
   Inventory in process, August 1 balance			$
   To complete inventory in process, August 1	$	$
   Cost of completed August 1 work in process			$
   Started and completed in August
   Transferred to finished goods in August (3)			$
   Inventory in process, August 31 (4)
   Total costs assigned by the Roasting Department			$

   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		$
   Change in conversion cost per equivalent unit

2 more Check My Work uses remaining.

Answer 1

UNITS TO ACCOUNT FOR:
Beginning Work in Process units					500
Add: Units Started in Process					16,000
Total Units to account for:					16,500
UNITS TO BE ACCOUNTED FOR:
Units completed from Beginning WIP					500
Units started and completed					15,200
Ending Work in Process					800
Total Units to be accounted for:					16,500
Equivalent Units:
			WHOLE	Material Cost		Conversion
			UNITS	% Completion	Units	% Completion	Units
Units completed from Beg. WIP			500	0%	0	60%	300
Units started and completed			15200	100%	15,200	100%	15,200
Total Completed units			15700		15,200		15,500
Ending Work in Process			800	100%	800	40%	320
Total Equivalent units					16,000		15,820
COST PER EQUIVALENT UNIT:
				Material		Conversion
Total cost added during the year				56,800		23,730
Equivalent Units				16,000		15,820
Cost per Equivalent unit				3.55		1.5
Cost a ssigned to production:				Material	Conversion	Total
Invenntory in process in beg						2080
Cost incurred				56800	23730	80530
Total cost accounted for						82610
Cost allocated to completed and partially completed unts:
				Material	Conversion	Total Cost
Beginning Cost						2080
To complete inventory in process				0	450	450
Cost of completing beginning WIP						2530
Started and completed units in Aug				53960	22800	76760
Transferred to Finished Goods						79290
Inventory in process Auug31				2840	480	3320
Ttal cost assigned to roasting						82610
Direct material cost per unt in beginning =1800 /500 =3.6
Conversion cost per unit in beginning =280 / 200 =1.4
Change in material cost			Decrease	0.05
Change in conversion cost			Increase	0.1