Cost of Production Report: Average Cost Method Sunrise Coffee Company roasts and
ID: 2547317 • 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:
ACCOUNT Work in Process—Roasting Department
ACCOUNT NO.
Date
Item
Debit
Credit
Balance
Debit
Credit
Dec.
1
Bal., 10,500 units, 75% completed
21,000
31
Direct materials, 210,400 units
246,800
267,800
31
Direct labor
135,700
403,500
31
Factory overhead
168,630
572,130
31
Goods transferred, 208,900 units
?
?
31
Bal., ? units, 25% completed
?
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 the nearest cent.
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
Received from materials storeroom
Total units accounted for by the Roasting Department
Units to be assigned costs:
Whole Units
Equivalent Units of Production
Transferred to Packing Department in December
Inventory in process, December 31
Total units to be assigned costs
Cost Information
Unit costs:
Costs
Total costs for December in Roasting Department
$
Total equivalent units
Cost per equivalent unit
$
Costs charged to production:
Inventory in process, December 1
$
Costs incurred in December
Total costs accounted for by the Roasting Department
$
Costs allocated to completed and partially completed units:
Transferred to Packing Department in December
$
Inventory in process, December 31
Total costs assigned by the Roasting Department
$
ACCOUNT Work in Process—Roasting Department
ACCOUNT NO.
Date
Item
Debit
Credit
Balance
Debit
Credit
Dec.
1
Bal., 10,500 units, 75% completed
21,000
31
Direct materials, 210,400 units
246,800
267,800
31
Direct labor
135,700
403,500
31
Factory overhead
168,630
572,130
31
Goods transferred, 208,900 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 10500 Received from materials storeroom 210400 Total units accounted for by the Roasting Department 220900 Units to be assigned costs: Whole Units Equivalent Units of Production Transferred to Packing Department in December 208900 208900 Inventory in process, December 31 12000 3000 Total units to be assigned costs 220900 211900 Cost Information Unit costs: Costs Total costs for December in Roasting Department 572130 Total equivalent units 211900 Cost per equivalent unit 2.7 Costs charged to production: Inventory in process, December 1 21000 Costs incurred in December 551130 Total costs accounted for by the Roasting Department 572130 Costs allocated to completed and partially completed units: Transferred to Packing Department in December 564030 Inventory in process, December 31 8100 Total costs assigned by the Roasting Department 572130