eBook Print Item Cost of Production Report The debits to Work in Process-Roastin
ID: 2589296 • Letter: E
Question
eBook Print Item Cost of Production Report The debits to Work in Process-Roasting Department for St. Arbucks Coffee Company for July 2016, together with information concerning production, are as followss Work in process, July 1, 500 pounds, 40% completed $1,450* Direct materials (500 X $2.5) Conversion (500 x 40% x $1) $1,250 $200 $1,450 Coffee beans added during July, 16,000 pounds Conversion costs during July Work in process, July 31, 800 pounds, 50% completed Goods finished during July, 15,700 pounds All direct materials are placed in process at the beginning of production a. Prepare a cost of production report, presenting the following computations 39,200 17,490 1. Direct materials and conversion equivalent units of production for July 2. Direct materials and conversion costs per equivalent unit for July. 3. Cost of goods finished during July. 4. 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. St. Arbucks Coffee Company Cost of Production Report Roasting Department For the Month Ended July 31, 2016 Check My Work 3 more Check My Work uses remaining Previa Email instructor Save and Exit Submit Ass 2Explanation / Answer
Solution:
FIFO Method in Process Costing
Physical Units Count
In FIFO method, the unit of beginning inventory is completed first and then Units received during the period is completed.
Equivalent units of Material
In FIFO method,
- First we calculate the cost per equivalent units of material and conversion by using the cost incurred during the current period i.e. current period cost and divide by equivalent units of production.
- While calculating the equivalent cost per unit of production beginning WIP cost is ignored.
Cost Accounted for:
Cost of Beginning Units is the sum of following
(i) Current Period Cost (i.e. the cost of equivalent production units part of beginning inventory completed during the period and
(ii) the cost of beginning inventory
The part of beginning inventory completed during the period is calculated by multiplying the cost of equivalent units with the completed equivalent part of beginning units during the current period
Ending Inventory
The Ending Inventory is valued at current period cost i.e. the cost added during the current period/month.
Cost of Production Report - Roasting Department
For the Month Ended July 31, 2016
Unit information
Units charged to production:
Inventory in process, July 1
500
Received from materials storeroom
16,000
Total units accounted for by the Roasting Department
16,500
Units to be assigned cost:
Equivalent Units
Whole Units
Direct Material
Conversion Costs
Inventory in process, July 1 (40% Completed and 60% is complete in July month)
500
0
300
Started and completed in July (15,500 Units - 900)
15,200
15,200
15,200
Transferred to finished goods in July
15,700
15,200
15,500
Inventory in process, July 31 (50% complete)
800
800
400
Total units to be assigned cost
16,500
16,000
15,900
Cost Information
Direct materials
Conversion
Cost per Equivalent Unit:
Total Cost for July in Roasting Department
$39,200
$17,490
Total equivalent units
16,000
15900
Cost per Equivalent Unit (2)
$2.45
$1.10
Direct materials
Conversion
Total
Cost to be assigned to production:
Inventory in process, July 1
$1,450
Cost incurred in July (39200 + 17490)
$56,690
Total cost accounted for by the Roasting Department
$58,140
Cost allocated to completed and partially completed units:
Inventory in process, July 1, balance
$1,450
To complete Inventory in process, July 1
$0
$330
(300 Eq. Unit x $1.1 cost per equ unit for conversion)
$330
Cost of completed July 1 work in process
$1,780
Started and completed in July
$37,240
(15200*$2.45)
$16,720
(15,200*$1.10)
$53,960
Transferred to finished goods in July (3)
$55,740
Inventory in process, July 31 (4)
$1,960
(800*$2.45)
$440
(400*$1.1)
$2,400
Total costs assigned to the Roasting Department
$58,140
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Cost of Production Report - Roasting Department
For the Month Ended July 31, 2016
Unit information
Units charged to production:
Inventory in process, July 1
500
Received from materials storeroom
16,000
Total units accounted for by the Roasting Department
16,500
Units to be assigned cost:
Equivalent Units
Whole Units
Direct Material
Conversion Costs
Inventory in process, July 1 (40% Completed and 60% is complete in July month)
500
0
300
Started and completed in July (15,500 Units - 900)
15,200
15,200
15,200
Transferred to finished goods in July
15,700
15,200
15,500
Inventory in process, July 31 (50% complete)
800
800
400
Total units to be assigned cost
16,500
16,000
15,900
Cost Information
Direct materials
Conversion
Cost per Equivalent Unit:
Total Cost for July in Roasting Department
$39,200
$17,490
Total equivalent units
16,000
15900
Cost per Equivalent Unit (2)
$2.45
$1.10
Direct materials
Conversion
Total
Cost to be assigned to production:
Inventory in process, July 1
$1,450
Cost incurred in July (39200 + 17490)
$56,690
Total cost accounted for by the Roasting Department
$58,140
Cost allocated to completed and partially completed units:
Inventory in process, July 1, balance
$1,450
To complete Inventory in process, July 1
$0
$330
(300 Eq. Unit x $1.1 cost per equ unit for conversion)
$330
Cost of completed July 1 work in process
$1,780
Started and completed in July
$37,240
(15200*$2.45)
$16,720
(15,200*$1.10)
$53,960
Transferred to finished goods in July (3)
$55,740
Inventory in process, July 31 (4)
$1,960
(800*$2.45)
$440
(400*$1.1)
$2,400
Total costs assigned to the Roasting Department
$58,140
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