Sunrise Coffee Company roasts and packs coffee beans. The process begins in the Roasting Department. From the Roasting Department, the coffee beans are transferred to the Packing Department. The following is a partial work in process account of the Roasting Department at December 31:

ACCOUNT Work in Process-Roasting Department ACCOUNT NO.
Date Item Debit Credit Balance
Debit Credit
Dec. 1 Bal., 15,500 units, 40% completed 64,170
31 Direct materials, 268,200 units 630,270 694,440
31 Direct labor 363,624 1,058,064
31 Factory overhead 523,264 1,581,328
31 Goods transferred, 270,500 units ? ?
31 Bal., ? units, 90% completed ?

Required:
Prepare a cost of production report, using the average cost method, and identify the missing amounts for Work in Process—Roasting Department.

Question

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Respuesta :

anthougo anthougo · Answer 1 · 2020-10-02T17:47:09+02:00

Answer:

Sunrise Coffee Company

Roasting Department

Production Cost Report

Units

Opening WIP 15,500

Direct materials 268,200

less units transferred (270,500)

Ending WIP 13,200

Degree of completion = 90% * 13,200 = 11,880

Unit Unit Cost Total Production Cost

Transferred out 270,500 $5.60 $1,514,800

Ending WIP 11,880 $5.60 66,528

Total equivalent 282,380 $1,581,328

Explanation:

a) Data:

Date Item Debit Credit Balance

Dec. 1 Bal., 15,500 units, 40% completed 64,170

31 Direct materials, 268,200 units 630,270 694,440

31 Direct labor 363,624 1,058,064

31 Factory overhead 523,264 1,581,328

31 Goods transferred, 270,500 units ? ?

31 Bal., 13,200 units, 90% completed ?

Equivalent units:

Transferred out 270,500

Ending WIP 11,880

Total equivalent 282,380

Cost per equivalent unit = $1,581,328

Average cost = $1,581,328/282,380 = $5.60