Hurtt’s Java Seeds is an independent roaster of specialty coffee beans. The company budgets 2 months ahead, so that in early January, it is time to plan for March. During March, the company plans to sell 40,000 pounds of beans. At the end of February, the company expects to have 3,000 pounds of raw green coffee beans (costing $5,000) and 800 pounds of roasted beans (costing $4,200) in inventory. Hurtt’s would like to have 1,100 pounds of green coffee beans and 500 pounds of roasted beans in inventory at the end of March. Hurtt’s purchases green coffee beans from the grower at $3 per pound and sells the roasted beans for $13 per pound. Hurtt’s roasters hold 25 pounds of green coffee beans. It takes 19 minutes to roast the beans to perfection. Because the roaster must be monitored by an employee at all times, each batch requires 0.30 direct labor hours. During the roasting process, the green beans lose 25% of their weight, so that 1.25 pounds of green (raw) beans must be used to produce 1 pound of roasted beans. The standard direct labor rate is $13 per direct labor hour. Variable overhead is applied at the rate of $84 per direct labor hour, and fixed overhead is budgeted at $13,095 per month, including $1,570 in equipment depreciation. Compute Hurtt’s ending inventory balances and cost of goods sold for March. (Round answers to 2 decimal places, e.g. 15.25.) *Must Show ALL Work! Ending Finished Goods Inventory balance $ Cost of goods sold $
Hurtt’s Java Seeds is an independent roaster of specialty coffee beans. The company budgets 2 months ahead, so that in early January, it is time to plan for March. During March, the company plans to sell 40,000 pounds of beans. At the end of February, the company expects to have 3,000 pounds of raw green coffee beans (costing $5,000) and 800 pounds of roasted beans (costing $4,200) in inventory. Hurtt’s would like to have 1,100 pounds of green coffee beans and 500 pounds of roasted beans in inventory at the end of March. Hurtt’s purchases green coffee beans from the grower at $3 per pound and sells the roasted beans for $13 per pound.
Hurtt’s roasters hold 25 pounds of green coffee beans. It takes 19 minutes to roast the beans to perfection. Because the roaster must be monitored by an employee at all times, each batch requires 0.30 direct labor hours. During the roasting process, the green beans lose 25% of their weight, so that 1.25 pounds of green (raw) beans must be used to produce 1 pound of roasted beans. The standard direct labor rate is $13 per direct labor hour. Variable
Compute Hurtt’s ending inventory balances and cost of goods sold for March. (Round answers to 2 decimal places, e.g. 15.25.) *Must Show ALL Work!
| Ending Finished Goods Inventory balance | $ | ||
|---|---|---|---|
| Cost of goods sold | $ |
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