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 Sifting and Packaging departments, emerging as packaged refined flour. The balance in the account Work in Process-Sifting Department was as follows on July 1: Work in Process-Sifting Department (800 units, 3/5 completed): Direct materials (800 * $2.15) $1,720 Conversion (800 x 3/5 * $0.50) 240 $1,960 The following costs were charged to Work in Process-Sifting Department during July: Direct materials transferred from Milling Department: 15,500 units at $2.25 a unit $34,875 Direct labor 4,540 Factory overhead 4,018 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 1 800 Received from Milling Department Total units accounted for by the Sifting Department 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 Cost of Production Report Costs 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 69 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. Question not attempted. PAGE 10 JOURNAL Score: 0/51 ACCOUNTING EQUATION DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2 3 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: $ Conversion: $ Points: 074 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 and 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 another, such as those in part (3), can be studied carefully and any significant differences investigated. Points: 0/2