Grainy Goodness Company manufactures granola cereal by a series of three processes, beginning materials such as oats, sweeteners, and nuts being introduced in the Mixing Department. From the Mixing Department, the materials pass through the Baking and Packaging departments, emerging as boxed granola cereal ready for shipment to retail outlets. Direct materials are added at the beginning of each process, and conversion costs are incurred evenly throughout production in each department.
During March, the President and sole stockholder, Jonathan Groat, reviewed the Cost of Production Report for the Mixing Department. He is concerned that the Mixing Department may not be operating efficiently, and asks for your help.
Question Content Area
Cost of Production
Jonathan has noticed that his production manager has omitted some of the data on the Cost of Production. Determine the missing information. If there is no amount or an amount is zero, enter "0". Round your per-unit computations to the nearest cent, if required.
Grainy Goodness Company
Cost of Production Report-Mixing Department
For the Month Ended March 31
Unit Information
Units charged to production:
Number of Units
Inventory in process, March 1
2,000
Received from materials storeroom
38,000
Total units accounted for by the Mixing Department
40,000
Units to be assigned costs:
Equivalent Units
Whole Units
Direct Materials
Conversion
Inventory in process, March 1 (40% completed)
2,000
_________________
__________________
Started and completed in March
35,000
35,000
35,000
Transferred to Baking Department in March
37,000
_________________
________________
Inventory in process, March 31 (80% completed)
3,000
__________________
________________
Total units to be assigned costs
40,000
__________________
________________
Cost Information
Cost per equivalent unit:
Direct Materials
Conversion
Total costs for March in Mixing Department
$40,660
$36,670
Total equivalent units
_________________
_________________
Cost per equivalent unit
_________________
_________________
Costs assigned to production:
Direct Materials
Conversion
Total
Inventory in process, March 1
$2,200
$600
$2,800
Costs incurred in March
77,330
Total costs accounted for by the Mixing Department
$80,130
Cost allocated to completed and partially completed units:
Inventory in process, March 1-balance
$2,800
To complete inventory in process, March 1
_________________
1,140
1,140
Cost of completed March 1 work in process
$3,940
Started and completed in March
37,450
33,250
70,700
Transferred to Baking Department in March
______________
Inventory in process, March 31
3,210
2,280
________________
Total costs assigned by the Mixing Department
________________
Question Content Area
February Cost Analysis
Determine the cost per unit of direct materials and for conversion for the month of February using the completed data on the Cost of Production. Round your per-unit computations to the nearest cent, if required.
Cost Analysis for February - Mixing Department
Amount
Equivalent Units
Cost per Unit
Direct Materials in inventory in process, March 1
_________________
________________
_______________
Conversion costs in inventory in process, March 1
_______________
________________
_______________
Total cost per unit
_______________
Question Content Area
March Cost Analysis
Determine the cost per unit of direct materials and for conversion for the month of March using the completed data on the Cost of Production. Round your per-unit computations to the nearest cent, if required.
Cost Analysis for March- Mixing Department
Amount
Equivalent Units
Cost per Unit
Costs for March: Direct Materials
_________________
_________________
________________
Costs for March: Conversion
_________________
_________________
_________________
Total cost per unit
_________________
Question Content Area
Mixing Dept. Evaluation
After reviewing your work on the February Cost Analysis and March Cost Analysis, assist Jonathan Groat in evaluating the Mixing Department’s performance by answering the following questions:
In March, was the Mixing Department’s total cost per unit higher or lower than in February?
For which component was the cost per unit for March higher than in February?
What is most probably your recommendation to Jonathan Groat given your computations?
Question Content Area
Journal
On March 31, using the data provided on the Cost of Production, journalize the entry to move the appropriate amount of cost from the Mixing Department to the Baking Department. If an amount box does not require an entry, leave it blank.
Mar. 31
-
- Select -
- Select -
- Select -
Definition Definition Method of recording financial transactions in the book of original entry by debiting and crediting the accounts affected by a transaction using the golden rules of accrual accounting.
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