Cost of Production Report Hana Coffee Company roasts and packs coffee beans. The
ID: 2515834 • 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 $14,790 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.
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2. Compare the costs per equivalent unit for February and July. The costs per equivalent unit for materials and conversion for February are in the July 1 work in process inventory. The materials amount is given.
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Partially correct
ACCOUNT Work in Process—Roasting Department ACCOUNT NO. Date Item Debit Credit Balance Debit Credit July 1 Bal., 5,100 units, 3/5 completed 17,544 31 Direct materials, 229,500 units 688,500 706,044 31 Direct labor 145,800 851,844 31 Factory overhead 36,488 888,332 31 Goods transferred, 230,000 units ? 31 Bal., ? units, 1/5 completed ?Explanation / Answer
UNITS TO ACCOUNT FOR: Beginning Work in Process units 5,100 Add: Units Started in Process 229,500 Total Units to account for: 234,600 UNITS TO BE ACCOUNTED FOR: Equivalent Units: Units Materail Conversion Units Units Units completed from Beg. WIP 5100 0 2,040 Units started and completed 224900 224,900 224,900 Units transferred to packing 230000 224,900 226,940 Ending Work in Process 4600 4,600 920 Total Equivalent units 229,500 227,860 COST PER EQUIVALENT UNIT: Material Conversion Total cost added during the year 688,500 182,288 Equivalent Units 229,500 227,860 Cost per Equivalent unit 3 0.8 Cost assigned to production: Material Conversion Total Inventory in Beg. Process 17544 Cost incured in July 688500 182288 870788 Total cost to be accounted for: 688500 182288 888332 Cost allocated as follows: Inventory in process in beg. 17544 To complete inventory in process 0 1632 1632 cost of completed July 1 in process 19176 Started and completed 674700 179920 854620 Transferred to Molding department 873796 Inventory in Process July 31 13800 736 14536 Total cost assigned to Roasting deptt. 688500 182288 888332 Req 2: Total Cost of Begg Wip 17544 Material cost 14790 Converesion cost 2754 Material cost per unit (14790/5100): 2.9 Conversion cost per unit (2754/3060): 0.9 Change in material cost per unit Increased by $ 0.10 per unit Change in Conversion cost per unit Decreased by $ 0.10 per unit