Sunspot Beverages, Ltd., of Fiji makes blended tropical fruit drinks in two stag

Question

Sunspot Beverages, Ltd., of Fiji makes blended tropical fruit drinks in two stages. Fruit juices are extracted from fresh fruits and then blended in the Blending Department. The blended juices are then bottled and packed for shipping in the Botting Department. The following information pertains to the operations of the Blending Department for June. Percent Completed Units Materials Conversion 70% 74,000 367.000 357.000 84,000 Work in process, beginning Started into production 40% Work in process, ending 75% 25% Work in process, beginning Cost added during June S 28,000 S 9,800 S 299,600 $ 209.440 Required: Assume that the company uses ft 1. Determine the equivalent units for June for the Blending Department. average method. Equivalent units of production 420,000 378,000 2. Compute the costs per equivalent unit for the Blending Department. (Round your answers to 2 decimal places.) Cost per equivalent unit 3. Determine the total cost of ending work in process inventory and the total cost of units transferred to the Bottling Department. (Round your intermediate calculations to 2 decimal places. Round your final answers to the nearest whole dollar.] Cost of ending work in process inventory Cost of units comp leted and transferred out

Explanation / Answer

1. Equivalent unit of production :

Calculate cost per equivalent unit :

Cost of ending work in process = (63000*.78+21000*.58) = 61320

Cost of unit completed and transferred out = (0.78+0.58)*357000 = 485520

Physical unit % Material % Conversion cost Unit completed and transferred out 357000 100% 357000 100% 357000 Ending work in process 84000 75% 63000 25% 21000 Total equivalent unit of production 420000 378000

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