Cost of Production Report Fresh Mountain Coffee Company roasts and packs coffee
ID: 2526950 • Letter: C
Question
Cost of Production Report
Fresh Mountain 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 March 31, 2016:
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 in a zero "0". When computing cost per equivalent units, round to the nearest cent.
2. Assuming that the March 1 work in process inventory includes $5,700 of direct materials, determine the increase or decrease in the cost per equivalent unit for direct materials and conversion between February and March. If required, round your answers to two decimal places.
ACCOUNT Work in Process—Roasting Department ACCOUNT NO. Date Item Debit Credit Balance Debit Credit Mar. 1 Bal., 1,500 units, 30% completed 6,150 31 Direct materials, 22,300 units 86,970 93,120 31 Direct labor 11,900 105,020 31 Factory overhead 5,772 110,792 31 Goods transferred, 21,700 units ? 31 Bal., ? units, 40% completed ?Explanation / Answer
UNITS TO ACCOUNT FOR: Beginning Work in Process units 1,500 Add: Units Started in Process 22,300 Total Units to account for: 23,800 Equivalent Units: Whole units Material Cost Conversion % Completion Units % Completion Units Units completed from Beg. WIP 1500 0% 0 70% 1,050 Units started and completed 20200 100% 20,200 100% 20,200 Transferred to Molding deptt 21700 20,200 21,250 Ending Work in Process 2100 100% 2,100 40% 840 Total Equivalent units 22,300 22,090 TOTAL COST TO ACCOUNT FOR: COST PER EQUIVALENT UNIT: Material Conversion Total cost added during the year 86,970 17,672 Equivalent Units 22,300 22,090 Cost per Equivalent unit 3.9 0.8 Cost charged to production: Material Convesion Total Inventory in Beg. 6150 Current cocst of manufacture 104642 Total cost to be accounted for: 110792 Cost allocated to completed and partially completed units: Inventory in Beg. 6150 Cost to complete 0 840 840 Cost of completed Beg. WIP 6990 Started and completed 78780 16160 94940 Transfrred to Molding 101930 Inveentory in Mar31 8190 672 8862 Total cost assigned 110792 Req 2: Mmateriall c cost per unit in last year (5700/1500): 3.8 Conversion cost perr unit last year(6150-5700)/450: 1 Change in material Increase Change in conversion Decrease