Cole Patterson operates Cole's Cricket Farm in Clarkston, Georgia. Cole's raises about 18 million crickets a month. Most are sold to pet stores at $12.80 for a box of 1,000 crickets. Pet stores sell the crickets for $0.05 to $0.10 each as live feed for reptiles. i (Click on the icon to view additional information.) (Click the icon to view the production cost report-Part 1.) (Click the icon to view the production cost report-Parts 2/3.) Read the requirements. Requirement 1. What is the cost per box of crickets sold? (Hint: This is the cost of the boxes completed and shipped out of brooding.) First, identify the labels to compute the average cost per box transferred out, then compute the average cost per box shipped out of brooding. (Enter your answer to the nearest cent.) Requirement 2. What is the gross profit per box? = Average cost per box First, identify the labels to compute the gross profit per box, then compute the gross profit per box. (Enter all dollar amounts to the nearest cent.) Gross profit per box Requirement 3. How much operating income did Cole's Cricket Farm make in June? First, identify the labels to compute the operating income, then compute the operating income for June. Operating income Requirement 4. What is the return on Patterson's investment of $460,000 for the month of June? (Compute this as June's operating income divided by Patterson's investment, expressed as a percentage.) (Round the return on investment to the nearest hundredth of a percent, X.XX%.) The return on Patterson's investment of $460,000 for the month of June is %. Requirement 5. What monthly operating income would provide a 3.6% monthly rate of return? What price per box would Cole's Cricket Farm have had to charge in June to achieve this target monthly rate of return? First, identify the labels to compute the desired monthly operating income, then compute the amount. Monthly operating income % Identify the labels to compute the selling price per box needed to achieve a 3.6% monthly rate of return, then compute the amount. + Selling price per box More info Raising crickets requires a two-step process: incubation and brooding. In the first process, incubation, employees place cricket eggs on mounds of peat moss to hatch. In the second process, employees move the newly hatched crickets into large boxes filled with cardboard dividers. Depending on the desired size, the crickets spend approximately two weeks in brooding before being shipped to pet stores. In the brooding process, Cole's crickets consume about 16 tons of food and produce 12 tons of manure. Patterson has invested $460,000 in the cricket farm, and he had hoped to earn a 43.2% annual rate of return, which works out to a 3.6% monthly return on his investment. After looking at the farm's bank balance, Patterson fears he is not achieving this return. To get more accurate information on the farm's performance, Patterson bought new accounting software that provides weighted-average process cost information. After Patterson input the data, the software provided the following reports. However, Patterson needs help interpreting these reports. Patterson does know that a unit of production is a box of 1,000 crickets. For example, in June's report, the 2,000 physical units of beginning work in process inventory are 2,000 boxes (each one of those boxes contains 1,000 immature crickets). The finished goods inventory is zero because the crickets ship out as soon as they reach the required size. Monthly operating expenses total $6,100 (in addition to the costs that follow). - Data table 1 A Cole's Cricket Farm-Brooding Department Month Ended June 30 Production Cost Report (part 1 of 3) B C Step 1: D Step 2: Equivalent Units Flow of Physical Transferred- Direct Materials Units in E Conversion Costs 2 3 Flow of Production 4 Units to account for: 5 Beginning work in process, June 1 2,000 6 Plus: Transferred in during June 25,000 7 Total physical units to account for 27,000 8 Units accounted for: 9 Completed and shipped out during June 22,000 22,000 22,000 22,000 10 Plus: Ending work in process, June 30 5,000 5,000 3,000 1,500 11 Total physical units accounted for 27,000 12 Total equivalent units 27,000 25,000 23,500 Data table A B D E 1 Cole's Cricket Farm-Brooding Department Month Ended June 30 Transferred- Direct Conversion 2 Production Cost Report (part 2 of 3) in Materials Costs Total 3 Beginning work in process, June 1 $ 10,600 $ 29,000 $ 3,990 $ 43,590 5 4 Plus: Costs added during June Total costs to account for 49,340 157,000 51,000 257,340 $ 59,940 $ 186,000 $ 54,990 $ 300,930 6 Divided by: Total equivalent units 27,000 25,000 23,500 7 Cost per equivalent unit $ 2.22 $ 7.44 $ 2.34 A B D E 1 Cole's Cricket Farm-Brooding Department Month Ended June 30 Transferred- Direct Conversion 2 Production Cost Report (part 3 of 3) in Materials Costs Total 3 Assignment of total cost: 4 Completed and transferred out: 5 Equivalent units completed and transferred out 22,000 22,000 22,000 6 Multiplied by: Cost per equivalent unit $ 2.22 $ 7.44 $ 2.34 7 Costs assigned to units completed and transferred out $ 48,840 $ 163,680 $ 51,480 $ 264,000 8 Ending work in process: 9 Equivalent units in ending WIP 5,000 3,000 1,500 10 Multiplied by: Cost per equivalent unit $ 2.22 $ 7.44 $ 2.34 11 Costs assigned to units in ending WIP $ 11,100 $ 22,320 $ 3,510 36,930 12 Total costs accounted for $ 300,930