Swiss Chocolates Ltd produces blocks of chocolate. Raw materials in the form of cocoa solids, milk and

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Swiss Chocolates Ltd produces blocks of chocolate. Raw materials in the form of cocoa solids, milk and sugar are added at the beginning of the process, flavouring, fruit and nuts are added half-way through the process and a cardboard box is added at the end. The conversion costs (direct labour and factory overhead) are incurred uniformly throughout the process. The following cost and production data are available for the month of June 2016.


Beginning work in process inventory:

Units

Cost of cocoa etc. added

Cost of flavouring etc. added

Cost of boxes added

Conversion costs added

June operating data:

Units started

Units finished

Cost of cocoa etc. added

Cost of flavouring etc. added

Cost of boxes added

Conversion costs


60000blocks of chocolate

$36000

$12000

600000blocks of chocolate

620000blocks of chocolate

$360000

$124000

$62000

$306000


The ending work in process inventory was 40% complete as to conversion costs.


Required

A. Determine equivalent units for both raw materials and conversion costs.

B. Prepare a cost of production report for the June 2016 production.

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Accounting

ISBN: 978-1118608227

9th edition

Authors: Lew Edwards, John Medlin, Keryn Chalmers, Andreas Hellmann, Claire Beattie, Jodie Maxfield, John Hoggett

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