Question

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, 600 pounds, 20% completed				$3,372*
	*Direct materials (600 X $5.2)	$3,120
	Conversion (600 X 20% X $2.1)	$252
		$3,372
Coffee beans added during August, 19,000 pounds				97,850
Conversion costs during August				41,316
Work in process, August 31, 1,000 pounds, 30% completed				?
Goods finished during August, 18,600 pounds				?

All direct materials are placed in process at the beginning of production.

a. Prepare a cost of production report, presenting the following computations:

Direct materials and conversion equivalent units of production for August.

Direct materials and conversion costs per equivalent unit for August.

Cost of goods finished during August.

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		$

Answer 1

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			600
Received from materials storeroom			19000
Total units accounted for by the Roasting Department			19600
Units to be assigned costs:
		Equivalent Units
	Whole Units	Direct Materials	Conversion
Inventory in process, August 1	600	0	480
Started and completed in August	18000	18000	18000
Transferred to Packing Department in August	18600	18000	18480
Inventory in process, August 31	1000	1000	300
Total units to be assigned costs	19600	19000	18780
Cost Information
Costs per equivalent unit:
		Direct Materials	Conversion
Total costs for August in Roasting Department		97850	41316
Total equivalent units		19000	18780
Cost per equivalent unit		5.15	2.2
Costs charged to production:
	Direct Materials	Conversion	Total
Inventory in process, August 1			3372
Costs incurred in August			139166
Total costs accounted for by the Roasting Department			142538
Cost allocated to completed and partially completed units:
Inventory in process, August 1 balance			3372
To complete inventory in process, August 1	0	1056	1056
Cost of completed August 1 work in process			4428
Started and completed in August	92700	39600	132300
Transferred to Packing Department in August			136728
Inventory in process, August 31	5150	660	5810
Total costs assigned by the Roasting Department			142538
2
	Increase or Decrease	Amount
Change in direct materials cost per equivalent unit	Decrease	0.05
Change in conversion cost per equivalent unit	Increase	0.1