Question 1:
Question 2:
Instructions White Diamond Flour Company manufactures flour by a series of three processes, beginning with wheat grain being introduced in the Milling Department. From the Milling Department, the materials pass through the Sitting and Packaging departments, emerging packaged refined flour. The balance in the account Work in Process-Sifting Department was as follows on July 1: Work in Process-Sifting Department (700 units, 345 completed): Direct materials (700 * $2.35) $1,645 Conversion (700 * 35 * $0.30) 126 $1.771 The following costs were charged to Work in Process-Sifting Department during July Direct materials transferred from Milling Department: 15.700 units at $2.45 a unit S38,465 Direct labor 4,480 Factory overhoad 1.022 During July, 15,100 units of flour were completed. Work in Process-Sifting Department on July 31 was 1,300 units, 4/5 completed. Required: 1. Prepare a cost of production report for the Sifting Department for July. If an amount is zero, enter "O". Round your cost per unit answers to the nearest cent and final answers to the nearest dollar amount. 2. Journalize the entries for costs transferred from Milling to Sifting and the costs transferred from Sifting to Packaging. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for spaces or journal explanations. Every line on a journal page is used for debit or credit entries. Do not add explanations or skip a line between journal entries. CNOW journals will automatically indent a credit entry when a credit amount is entered. Use the date July 31 for all journal entries. 3. Determine the increase or decrease in the cost per equivalent unit from June to July for direct materials and conversion costs. Round your answers to the nearest cent. 4. Discuss the uses of the cost of production report and the results of part (3). CHART OF ACCOUNTS White Diamond Flour Company General Ledger ASSETS REVENUE 110 Cash 410 Sales 121 Accounts Receivable 610 Interest Revenue 125 Notes Receivable 126 Interest Receivable EXPENSES 131 Materials 510 Cost of Goods Sold 141 Work in Process-Milling Department 520 Wages Expense 142 Work in Process-Sifting Department 531 Selling Expenses 143 Work in Process-Packaging Department 532 Insurance Expense 151 Factory Overhead-Milling Department 533 Utilities Expense 152 Factory Overhead-Sifting Department 534 Supplies Expense 153 Factory Overhead-Packaging Department 540 Administrative Expenses 161 Finished Goods 561 Depreciation Expense-Factory 171 Supplies 590 Miscellaneous Expense 172 Prepaid Insurance 710 Interest Expense 173 Prepaid Expenses 181 Land 172 Prepaid Insurance 710 Interest Expense 173 Prepaid Expenses 181 Land 191 Factory 192 Accumulated Depreciation-Factory LIABILITIES 210 Accounts Payable 221 Utilities Payable 231 Notes Payable 236 Interest Payable 251 Wages Payable EQUITY 311 Common Stock 340 Retained Earnings 351 Dividends 390 Income Summary Cost of Production Report Shaded calls have feedback. X 1. Prepare a cost of production report for the Sifting Department for July. If an amount is zero, enter "O". Round your cost per unit answers to the nearest cent and final answers to the nearest dollar amount WHITE DIAMOND FLOUR COMPANY Cost of Production Report-Sifting Department For the Month Ended July 31 Equivalent Units UNITS Whole Units Direct Materials Conversion Units charged to production: Inventory in process, July 1 700 Received from Milling Department 15,700 Total units accounted for by the Sifting Department 16,400 Units to be assigned costs: Inventory in process, July 1 (3/5 completed) Started and completed in July Transferred to Packaging Department in July Inventory in process, July 31 (4/5 completed) Total units to be assigned costs Direct Materials Conversion Total Cost per equivalent unit: Total costs for July in Sifting Department $ $ Total equivalent units + + Cost per equivalent unit $ $ Costs assigned to production: Inventory in process, July 1 $ Costs incurred in July Total costs accounted for by the Sifting Department $ Costs allocated to completed and partially completed units: Inventory in process, July 1-balance To complete inventory in process, July 1 $ $ Cost of completed July 1 work in process $ Started and completed in July Transferred to Packaging Department in July $ Inventory in process, July 31 Total costs assigned by the Sifting Department Journal Shaded cells have feedback. 2. Journalize the entries for costs transferred from Milling to Sifting and the costs transferred from Sifting to Packaging. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for spaces or journal explanations. Every line on a journal page is used for debit or credit entries. Do not add explanations or skip a line between journal entries. CNOW journals will automatically indent a credit entry when a credit amount entered. Use the date July 31 for all journal entries. Question not attempted. PAGE 10 JOURNAL Score: 0/51 ACCOUNTING EQUATION DATE DESCRIPTION POST. REF DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2 3 Points: 0/10 Feedback Final Questions Shaded cells have feedback. 3. Determine the increase or decrease in the cost per equivalent unit from June to July for direct materials and conversion costs. Round your answers to the nearest cent. Direct materials: $ Increase Conversion: $ Increase Points: 214 4. Discuss the uses of the cost of production report and the results of part (3). The cost of production report may be used as the basis for allocating product costs between Work in Process and Finished Goods V. The report can also be used to control costs by holding each department head responsible for the units entering production and the costs incurred in the department. Any differences in unit product costs from one month to another, such as those in part (3), can be studied carefully and any significant differences investigated. Points: 212 Feedback Check My Work an Cost of Production Report Hana Coffee Company roasts and packs coffee beans. The process begins by placing coffee beans into the Roasting Department. From the Roasting Department, coffee beans are then transferred to the Packing Department. The following is a partial work in process account of the Roasting Department at July 31: ACCOUNT Work in Process-Roasting Department ACCOUNT NO Balance Date Item Debit Credit Debit Credit July 8,560 1 Bal., 4,000 units, 2/5 completed 31 Direct materials, 180,000 units 360,000 368,560 31 Direct labor 72,600 441,160 459,360 31 Factory overhead 18,200 31 Goods transferred, 180,000 units ? 31 Bal., 2 units, 4/5 completed Required: 1. Prepare a cost of production report, and identify the missing amounts for Work in Process-Roasting Department. If an amount is zero, enter "0". When computing cost per equivalent units, round to two decimal places Hana Coffee Company Cost of Production Report-Roasting Department For the Month Ended July 31 Unit Information Units charged to production: Inventory in process, July 1 4,000 Received from materials storeroom 180,000 184,000 Total units accounted for by the Roasting Department Received from materials storeroom 180,000 Total units accounted for by the Roasting Department 184,000 Units to be assigned costs: Equivalent Units Direct Conversion Materials Whole Units Inventory in process, July 1 4,000 0 2,400 Started and completed in July 176,000 176,000 176,000 Transferred to Packing Department in July 180,000 176,000 178,400 Inventory in process, July 31 36,000 X 4,000 Total units to be assigned costs 180,000 Cost Information Cost per equivalent unit: Direct Materials Conversion Total costs for July in Roasting Department Total equivalent units Cost per equivalent unit Costs assigned to production: Direct Conversion Total Direct Materials Conversion Total Inventory in process, July 1 $ Costs incurred in July Total costs accounted for by the Roasting Department $ Costs allocated to completed and partially completed units: Inventory in process, July 1 balance To complete inventory in process, July 1 Cost of completed July 1 work in process $ Started and completed in July III Transferred to Molding Department in July Inventory in process, July 31 Total costs assigned by the Roasting Department 2. Assuming that the July 1 work in process inventory includes $7,600 of direct materials, determine the increase or decrease in the cost per equivalent unit for direct materials and conversion between February and July. If required, round your answers to the nearest cent. Increase or Decrease Amount Change in direct materials cost per equivalent unit Increase $ Change in conversion cost per equivalent unit Decrease
