Question

Appendix PR 17-5A Cost of production report: average cost method er equivalent Sunrise Coffee Company roasts and packs coffee beans. The process begins in unit, $2.70 ment. From the Roasting Department, the coffee beans are transferred to the The following is a partial work in process account of the Roasting Departme ACCOUNT Work in Process-Roasting Department begins in the Roasting Depart ed to the Packing Department. e Department at December 31: ACCOUNT NO. Balance Debit Credit EXCEL TEMPLATE Debit Credit Date Item Dec. 1 Bal, 10,500 units, 75% completed Direct materials, 210,400 units Direct labor Factory overhead Goods transferred, 208,900 units Bal., 2 units, 25% completed 246,800 135,700 168,630 21,000 267,800 403,500 572,130 Instructions Prepare a cost of production report, using the average cost method, and identify the missing amounts for Work in Process-Roasting Department.

Answer 1

Equivalent units of Production Company SC Cost of Production Report - Roasting Department For the Month Ended December 31 UNITS Whole units Units charged to production: Inventory in process, December 1 10,500 Received from material storeroom 210,400 Total units accounted for by the roasting department 220,900 Units to be assigned costs: Transferred to packing department in December 208,900 Add: Inventory in process, December 31 12.000 Total units to be assigned costs 220,900 208,900 3,000 211,900 Costs COSTS Cost per equivalent unit: Total costs for December in Roasting department (A) Total equivalents units (B) Cost per equivalent unit (A B) Cost assigned to Production: Inventory in process, December 1 Cost incurred in December Total costs accounted for by the roasting department $572.130 211,900 $2.70 $21,000 $551,130 $572,130 Cost allocated to completed and partially completed units: Transferred to packaging department in December Add: Inventory in process, December 31 Total costs assigned by the Roasting department $564,030 $8.100 $572,130

Working note:

Ending work in process inventory - whole units =10,500 units +210.400 units -208,900 =12,000 units Ending work in process Ending work in process inventory inventory-Equivalent units) whole units Percentage completed =12,000x25% = 3,000 Costs incurred during the month of December=$246,800+$ 135,700+$168,630 =5551,130 Cost allocated to completed and partially completed units: Transferred to packaging department in December - 208,900 units x2.70 = $564,030 Ending work in process inventory costs = 3,000 units $2.70 =58.100