Cost of Production Report Hana Coffee Company roasts and packs coffee beans. The
ID: 2341663 • Letter: C
Question
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:
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.
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1. Calculate equivalent units for materials and conversion costs. Calculate the cost per equivalent unit for materials and conversion costs. Calculate the costs assigned to the beginning inventory, the units started and completed, and the ending inventory.
2. Assuming that the July 1 work in process inventory includes $11,600 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.
ACCOUNT Work in Process—Roasting Department ACCOUNT NO. Date Item Debit Credit Balance Debit Credit July 1 Bal., 5,800 units, 3/5 completed 13,688 31 Direct materials, 261,000 units 548,100 561,788 31 Direct labor 104,900 666,688 31 Factory overhead 26,180 692,868 31 Goods transferred, 261,000 units ? 31 Bal., ? units, 4/5 completed ?Explanation / Answer
Answer 1. HANA COFFEE COMPANY Cost of Production Report - Casting Department For the Month ended July 31 Particulars Equivalent Units Physical Units Materials Conversion Costs Units Information Units Charged to Production Work in process - Beginning 5,800 Started into production 261,000 Total units 266,800 Units accounted for Goods Units Completed & transferred out: From Beginning WIP 5,800 - 2,320 (0% materials, 40% conversion costs) . Started & Completed (261,000 -5,800) 255,200 255,200 255,200 Work in process, Ending (266,800 - 261,000) 5,800 5,800 4,640 (100% materials, 80% conversion costs) Equivalent units accounted for 266,800 261,000 262,160 Materials Conversion Costs Total Total Cost to Account for: WIP, Beginning 13,688 Cost added in current period 548,100 131,080 679,180 Total cost to be account for 548,100 131,080 692,868 Cost added in current period 548,100 131,080 679,180 Equivalent Units of work done in current Period 261,000 262,160 Cost per Equivalent Unit 2.10 0.50 2.60 Assignment of Costs: Goods Units and Completed out (6,800 Units) WIP, Beginning - 5,800 Units - - 13,688 Cost added to Beg. WIP in Current period - 1,160 1,160 (2,320 Units X $0.50) Total of Beginning Inventory - 1,160 14,848 Started and completed - 255,200 Units 535,920 127,600 663,520 (255,200 units X $2.10) (255,200 units X $0.50) Total Cost of good units completed & transferred out 535,920 128,760 678,368 WIP, Ending - 5,800 Units 12,180 2,320 14,500 (5,800 units X $2.10) (5,800 units X $0.50) Total Cost accounted For 548,100 131,080 692,868 Answer 2. Calculation of Cost per Unit -Beginning Materials Conversion Costs Total WIP - Beginning 11,600 2,088 13,688 Equivalent No. of Unit - WIP - Beginning 5,800 3,480 Cost pet Equivalent Unit 2.00 0.60 2.60 Materials Conversion Costs Total Cost per Equivalent Unit - Beginning Inventory 2.00 0.60 2.60 Cost per Equivalent Unit - July 31 2.10 0.50 2.60 Increase (Decrease) in Cost per Unit 0.10 (0.10) -