Question

Cost of Production Report Hana Coffee Company roasts and packs coffee beans. The process begins by placing coffee beans into the Roasting Department. From the Roasting Department, coffee beans are then transferred to the Packing Department. The following is a partial work in process account of the Roasting Department at July 31: ACCOUNT Work in Process-Roasting Department ACCOUNT NO. Balance Date Item Debit Credit Debit Credit July 1 Bal., 5,400 units, 2/5 completed 31 Direct materials, 243,000 units 13,932 597,132 714,332 743,580 583,200 117,200 29,248 31 Direct labor 31 Factory overhead 31 Goods transferred, 243,000 units 31 Bal., 2 units, 3/5 completed Required: 1. Prepare a cost of production report, and identify the missing amounts for Work in Process-Roasting Department. If an amount is zero, enter "O". When computing cost per equivalent units, round to two decimal places. Hana Coffee Company Cost of Production Report-Roasting Department For the Month Ended July 31 Unit Information Units charged to production:

Answer 1

Hana Coffee Company
Cost of Production Report-Roasting Department
For the Month Ended July 31
Unit Information
Units charged to production:
Inventory in process, July 1			5400
Received from materials storeroom			243000
Total units accounted for by the Roasting Department			248400
Units to be assigned costs:
		Equivalent Units
	Whole Units	Direct Materials	Conversion
Inventory in process, July 1	5400	0	3240
Started and completed in July	237600	237600	237600
Transferred to Packing Department in July	243000	237600	240840
Inventory in process, July 31	5400	5400	3240
Total units to be assigned costs	248400	243000	244080
Cost Information
Costs per equivalent unit:
		Direct Materials	Conversion
Total costs for July in Roasting Department		583200	146448
Total equivalent units		243000	244080
Cost per equivalent unit		2.40	0.60
Costs charged to production:
	Direct Materials	Conversion	Total
Inventory in process, July 1			13932
Costs incurred in July			729648
Total costs accounted for by the Roasting Department			743580
Cost allocated to completed and partially completed units:
Inventory in process, July 1 balance			13932
To complete inventory in process, July 1	0	1944	1944
Cost of completed July 1 work in process			15876
Started and completed in July	570240	142560	712800
Transferred to Packing Department in July			728676
Inventory in process, July 31	12960	1944	14904
Total costs assigned by the Roasting Department			743580
2
	Increase or Decrease	Amount
Change in direct materials cost per equivalent unit	Increase	0.10	=2.4-(12420/5400)
Change in conversion cost per equivalent unit	Decrease	0.10	=0.6-((13932-12420)/(5400*2/5))