DE21-5 Polar Spring produces premium bottled water. Polar Spring purchases artesian water, stores the water in large
Question:
DE21-5 Polar Spring produces premium bottled water. Polar Spring purchases artesian water, stores the water in large tanks, and then runs the water through two processes: Filtration, where workers microfilter and ozonate the water Bottling, where workers bottle and package the filtered water During February, the filtration process incurs the following costs in processing 100.000 liters: Wages of workers operating the filtration equipment. Manufacturing overhead allocated to filtration. Water. Wages of workers operating ozonation equipment $ 5,550 12.025 50,000 6,425 Polar Spring has no beginning inventories. 1. Compute the February conversion costs in the Filtration Department. 2. If the Filtration Department completely processed 100,000 liters, what is the total filtra- tion cost per liter? 3. Now assume that 80,000 liters are completely filtered and ozonated, while the remaining 20.000 are only part way through the process at the end of February. Is the cost per com- pletely filtered and ozonated liter higher. lower, or the same as in requirement 2? Why?
Step by Step Answer:
Accounting
ISBN: 9780130906991
5th Edition
Authors: Charles T. Horngren, Walter T. Harrison, Linda S. Bamber, Betsy Willis, Becky Jones