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551
E–7
a.
A
B
C
1
Units
Equivalent Units
of Production
2
Units to be accounted for:
3
Beginning Work in Process
2,000
Cost per Equivalent Unit =
Units Equivalent Total
Costs Production Total
552
E–8
A
B
C
1
COLONEL DIRKS COFFEE COMPANY
2
Cost of Production Report—Roasting Department
3
For the Month Ended August 31
4
Units
Units
Equivalent Units
of Production
5
Units charged to production:
6
Inventory in process, August 1
2,000
A
B
1
Costs
2
Unit costs:
3
Total costs for August in Roasting Department
$ 587,450
4
Total equivalent units
÷ 94,750
553
E–9
A
B
C
1
ORIENTAL CARPET COMPANY
2
Cost of Production Report—Cutting Department
3
For the Month Ended May 31
4
Units
Units
Equivalent Units
of Production
5
Units charged to production:
6
Inventory in process, May 1
8,000
A
B
1
Costs
2
Unit costs:
3
Total costs for May in Cutting Department
$1,258,800
4
Total equivalent units
÷ 104,900
554
E–10
Memo
To: Production Manager
The cost of production report was used to identify the cost per case for each of
the four flavors as shown below.
A
B
C
D
E
1
Grape
Cola
Orange
Root Beer
2
Total cost
$26,075
$393,000
$292,500
$17,700
A
B
C
D
E
1
Cost per Case by Cost Element
2
Grape
Cola
Orange
Root Beer
3
Concentrate
$1.90
$2.25
$2.20
$1.80
555
E–11
The objective of this exercise is to determine if cost-per-pound trends in paper
stock, conversion, and coating costs are remaining stable over time. The follow-
ing table can be developed from the data:
a.
A
B
C
D
E
F
G
1
April
May
June
July
August
Sept.
2
Paper stock
($/pounds output)
$0.80
$0.80
$0.80
$0.80
$0.80
$0.80
b. Operator 1 believes that energy consumption is becoming less efficient. The
energy cost is part of the conversion cost. The conversion cost per output
556
PROBLEMS
P–1
A
B
C
1
JOSHUA FLOUR COMPANY
2
Cost of Production Report—Sifting Department
3
For the Month Ended March 31
4
Units
Units
Equivalent Units
of Production
5
Units charged to production:
6
Inventory in process, March 1
3,200
A
B
1
Costs
2
Unit costs:
3
Total costs for March in Sifting Department
$73,350*
557
P–2
A
B
C
1
SERGEANT WILKES COFFEE COMPANY
2
Cost of Production Report—Roasting Department
3
For the Month Ended October 31
4
Units
Units
Equivalent Units
of Production
5
Units charged to production:
6
Inventory in process, October 1
7,500
A
B
1
Costs
2
Unit costs:
3
Total costs for October in Roasting Department
$350,000
