The debits to Work in Process—Roasting Department for St. Arbucks Coffee Company
ID: 2513355 • Letter: T
Question
The debits to Work in Process—Roasting Department for St. Arbucks Coffee Company for July 2016, together with information concerning production, are as follows:
All direct materials are placed in process at the beginning of production.
a. Prepare a cost of production report, presenting the following computations:
Direct materials and conversion equivalent units of production for July.
Direct materials and conversion costs per equivalent unit for July.
Cost of goods finished during July.
Cost of work in process at July 31, 2016.
If an amount is zero, enter in "0". For the cost per equivalent unit, round your answer to two decimal places.
b. Compute and evaluate the change in cost per equivalent unit for direct materials and conversion from the previous month (June). If required, round your answers to the nearest cent.
Work in process, July 1, 400 pounds, 50% completed $1,720* *Direct materials (400 X $3.6) $1,440 Conversion (400 X 50% X $1.4) $280 $1,720 Coffee beans added during July, 13,000 pounds 46,150 Conversion costs during July 19,485 Work in process, July 31, 700 pounds, 70% completed ? Goods finished during July, 12,700 pounds ?Explanation / Answer
St. Arbucks Coffee Company
Remarks
Cost of Production Report-Roasting Department
For the Month Ended July 31, 2016
Unit Information
Units charged to production:
Inventory in process, July 1
400 Pound
Received from materials storeroom
13000 Pound
Total units accounted for by the Roasting Department
13400 Pound
Units to be assigned costs:
Equivalent Units
Whole Units
Direct Materials (1)
Conversion (1)
Inventory in process, July 1
400
0
200
Direct material taken 0 since the same were taken 100% in WIP during last month
Started and completed in July
12300
12300
12300
Transferred to finished goods in July
12700
12300
12500
Inventory in process, July 31
700
700
490
Conversion taken at 490 i.e. 70% of 700
Total units to be assigned costs
13400
13000
12990
Cost Information
Costs per equivalent unit:
Direct Materials
Conversion
Total costs for July in Roasting Department
46150
19485
Total equivalent units
13000
12990
Cost per equivalent unit (2)
3.55
1.50
Costs assigned to production:
Direct Materials
Conversion
Total
Inventory in process, July 1
0
300.00
300.00
Direct material taken 0 since the same were taken 100% in WIP during last month
Costs incurred in July
46,150.00
19,185.00
65,335.00
Total costs accounted for by the Roasting Department
46,150.00
19,485.00
65,635.00
Cost allocated to completed and partially completed units:
3.55 per unit
1.55 per unit
Inventory in process, July 1 balance
1440
280
1720
As given in question
To complete inventory in process, July 1
0
300
300
conversion cost at 400unit * 50% (balance work during current month) * 1.50 (Rate during July for conversion)
Cost of completed July 1 work in process
1440
580
2020
Started and completed in July
43665
18450
12300 units were started & completed in july
Transferred to finished goods in July (3)
43665
18750
62415
12700 units were transferred to finished goods i.e. Sum of "To complete inventory in process, July 1" & "started and completed in July"
Inventory in process, July 31 (4)
2485
735
3220
700 pounds; 100% for material @ 3.55 per unit & 70% for conversion @ 1.50 per unit
Total costs assigned by the Roasting Department
46150
19485
65635
Total of 3 & 4
Increase or Decrease
Amount
Change in direct materials cost per equivalent unit
Decrease
0.05
In July material cost is 3.55 per unit as compared to 3.60 per unit last month
Change in conversion cost per equivalent unit
Increase
0.1
In July conversion is 1.50 per unit as compared to 1.40 per unit last month
St. Arbucks Coffee Company
Remarks
Cost of Production Report-Roasting Department
For the Month Ended July 31, 2016
Unit Information
Units charged to production:
Inventory in process, July 1
400 Pound
Received from materials storeroom
13000 Pound
Total units accounted for by the Roasting Department
13400 Pound
Units to be assigned costs:
Equivalent Units
Whole Units
Direct Materials (1)
Conversion (1)
Inventory in process, July 1
400
0
200
Direct material taken 0 since the same were taken 100% in WIP during last month
Started and completed in July
12300
12300
12300
Transferred to finished goods in July
12700
12300
12500
Inventory in process, July 31
700
700
490
Conversion taken at 490 i.e. 70% of 700
Total units to be assigned costs
13400
13000
12990
Cost Information
Costs per equivalent unit:
Direct Materials
Conversion
Total costs for July in Roasting Department
46150
19485
Total equivalent units
13000
12990
Cost per equivalent unit (2)
3.55
1.50
Costs assigned to production:
Direct Materials
Conversion
Total
Inventory in process, July 1
0
300.00
300.00
Direct material taken 0 since the same were taken 100% in WIP during last month
Costs incurred in July
46,150.00
19,185.00
65,335.00
Total costs accounted for by the Roasting Department
46,150.00
19,485.00
65,635.00
Cost allocated to completed and partially completed units:
3.55 per unit
1.55 per unit
Inventory in process, July 1 balance
1440
280
1720
As given in question
To complete inventory in process, July 1
0
300
300
conversion cost at 400unit * 50% (balance work during current month) * 1.50 (Rate during July for conversion)
Cost of completed July 1 work in process
1440
580
2020
Started and completed in July
43665
18450
12300 units were started & completed in july
Transferred to finished goods in July (3)
43665
18750
62415
12700 units were transferred to finished goods i.e. Sum of "To complete inventory in process, July 1" & "started and completed in July"
Inventory in process, July 31 (4)
2485
735
3220
700 pounds; 100% for material @ 3.55 per unit & 70% for conversion @ 1.50 per unit
Total costs assigned by the Roasting Department
46150
19485
65635
Total of 3 & 4
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