Cost of Production Report: Average Cost Method Sunrise Coffee Company roasts and
ID: 2538311 • Letter: C
Question
Cost of Production Report: Average Cost Method
Sunrise Coffee Company roasts and packs coffee beans. The process begins in the Roasting Department. From the Roasting Department, the coffee beans are transferred to the Packing Department. The following is a partial work in process account of the Roasting Department at December 31:
Required:
Prepare a cost of production report, using the average cost method, and identify the missing amounts for Work in Process—Roasting Department. If required, round your cost per equivalent unit answer to two decimal places.
ACCOUNT Work in Process-Roasting Department ACCOUNT NO. Date Item Debit Credit Balance Debit Credit Dec. 1 Bal., 11,500 units, 75% completed 41,745 31 Direct materials, 199,000 units 409,940 451,685 31 Direct labor 222,938 674,623 31 Factory overhead 320,812 995,435 31 Goods transferred, 200,700 units ? ? 31 Bal., ? units, 25% completed ?Explanation / Answer
Sunrise Coffee Company Cost of Production Report-Roasting Department For the Month Ended December 31 Unit Information Units to account for during production: Inventory in process, December 1 11500 Received from materials storeroom 199000 Total units accounted for by the Roasting Department 210500 Units to be assigned costs: Whole Units Equivalent Units of Production Transferred to Packing Department in December 200700 200700 Inventory in process, December 31 9800 2450 Total units to be assigned costs 210500 203150 Cost Information Unit costs: Costs Total costs for December in Roasting Department 995435 Total equivalent units 203150 Cost per equivalent unit 4.9 Costs charged to production: Inventory in process, December 1 41745 Costs incurred in December 953690 Total costs accounted for by the Roasting Department 995435 Costs allocated to completed and partially completed units: Transferred to Packing Department in December 983430 Inventory in process, December 31 12005 Total costs assigned by the Roasting Department 995435