Hearty Soup Co. uses a process cost system to record the costs of processing soup, which requires the cooking and filling processes. Materials are entered from the cooking process at the beginning of the filling process. The inventory of Work in Process-Filling on April 1 and debits to the account during April 2016 were as follows:

Bal., 800 units, 30% completed:
Direct materials (800 $4.4)	$3,520
Conversion (800 30% $1.75)	420
	$3,940
From Cooking Department, 7,700 units	$34,650
Direct labor	8,540
Factory overhead	4,580

During April, 800 units in process on April 1 were completed, and of the 7,700 units entering the department, all were completed except 600 units that were 90% completed.

Charges to Work in Process-Filling for May were as follows:

From Cooking Department, 9,500 units	$44,650
Direct labor	12,000
Factory overhead	4,916

During May, the units in process at the beginning of the month were completed, and of the 9,500 units entering the department, all were completed except 250 units that were 35% completed.

Required:

1.

(a)

Enter the balance as of April 1, 2016, in a four-column account for Work in Process-Filling. Record the debits and the credits in the account for April.

(b)

Construct a cost of production report, and present computations for determining

i.	equivalent units of production for materials and conversion.
ii.	costs per equivalent unit.*
iii.	cost of goods finished, differentiating between units started in the prior period and units started and finished in April.*
iv.	work in process inventory.*
*	If an amount is zero, enter "0". Round your cost per unit answers to the nearest cent and final answers to the nearest dollar amount.

2.

(a)	Provide the same information for May by recording the May transactions in the four-column work in process account.
(b)	Construct a cost of production report, and present the May computations (i through iv) listed in part 1(b).

3.

Comment on the change in costs per equivalent unit for March through May for direct materials and conversion costs.

Work in Process-Filling Account

1(a).	Enter the balance as of April 1, 2016, in a four-column account for Work in Process-Filling. Record the debits and the credits in the account for April.
2(a).	Provide the same information for May by recording the May transactions in the four-column work in process account.

Work in Process-Filling

1	Date	Item	Debit	Credit	Balance Dr.	Balance Cr.
2	Apr. 1	Balance
3	30	Cooking Department
4	30	Direct labor
5	30	Factory overhead
6	30	Finished goods
7	30	Balance
8	May 31	Cooking Department
9	31	Direct labor
10	31	Factory overhead
11	31	Finished goods
12	31	Balance

Cost of Production Report - April

1(b).

Construct a cost of production report, and present computations for determining

i.	equivalent units of production for materials and conversion.
ii.	costs per equivalent unit.*
iii.	cost of goods finished, differentiating between units started in the prior period and units started and finished in April.*
iv.	work in process inventory.*
*	If an amount is zero, enter "0". Round your cost per unit answers to the nearest cent and final answers to the nearest dollar amount.

HEARTY SOUP CO.
Cost of Production Report-Filling Department
For the Month Ended April 30, 2016
UNITS	Whole Units	Equivalent Units
		Direct Materials	Conversion
Units to account for during production:
Inventory in process, April 1
Received from Milling Department
Total units accounted for by the Filling Department
Units to be assigned costs:
Inventory in process, April 1 (30% completed)
Started and completed in April
Transferred to finished goods in April
Inventory in process, April 30 (90% completed)
Total units to be assigned costs

COSTS	Costs
	Direct Materials	Conversion	Total
Cost per equivalent unit:
Total production costs for April in Filling Department
Total equivalent units
Cost per equivalent unit
Costs assigned to production:
Inventory in process, April 1
Costs incurred in April
Total costs accounted for by the Filling Department
Cost allocated to completed and
partially completed units:
Inventory in process, April 1 balance
To complete inventory in process, April 1
Cost of completed April 1 work in process
Started and completed in April
Transferred to finished goods in April
Inventory in process, April 30
Total costs assigned by the Filling Department

Cost of Production Report - May

2(b).

Construct a cost of production report, and present computations for determining

i.	equivalent units of production for materials and conversion
ii.	costs per equivalent unit*
iii.	cost of goods finished, differentiating between units started in the prior period and units started and finished in April*
iv.	work in process inventory.*
*	If an amount is zero, enter "0". Round your cost per unit answers to the nearest cent and final answers to the nearest dollar amount.

HEARTY SOUP CO.
Cost of Production Report-Filling Department
For the Month Ended May 31, 2016
UNITS	Whole Units	Equivalent Units
		Direct Materials	Conversion
Units charged to production:
Inventory in process, May 1
Received from Milling Department
Total units accounted for by the Filling Department
Units to be assigned costs:
Inventory in process, May 1 (90% completed)
Started and completed in May
Transferred to finished goods in May
Inventory in process, May 31 (35% completed)
Total units to be assigned costs

COSTS	Costs
	Direct Materials	Conversion	Total
Costs per equivalent unit:
Total costs for May in Filling Department
Total equivalent units
Cost per equivalent unit
Costs assigned to production:
Inventory in process, May 1
Costs incurred in May
Total costs accounted for by the Filling Department
Costs allocated to completed and
partially completed units:
Inventory in process, May 1 balance
To complete inventory in process, May 1
Cost of completed May 1 work in process
Started and completed in May
Transferred to finished goods in May
Inventory in process, May 31
Total costs assigned by the Filling Department

Final Question

The cost per equivalent unit for direct materials decreased from March to May. The cost per equivalent unit for conversion costs increased from March to May. These changes should be investigated for their underlying causes, and any necessary corrective actions should be taken.