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Robusta Coffee

Price: $3.00

Robusta Coffee Company processes chocolate into candy bars. The process begins by
placing direct materials (raw chocolate, milk, and sugar) into the Roasting Department.
All materials are placed into production at the beginning of the blending process. After
blending, the milk chocolate is then transferred to the Packing Department, where the
milk chocolate is formed into candy bars. The following is a partial work in process
account of the Roasting Department at January 31, 2012:

Debit Credit Debit Credit
1050 units, 30% completed      4,997  
Direct materials, 16,200 units  72,900    77,897  
Direct labor  10,800    88,697  
Factory overhead  8,910    97,607  
Goods transferred, 16,400 units        
Bal ? Units, 40% completed  

1. Prepare a cost of production report, and identify the missing amounts for Work in
Process—Blending Department.

2. Assuming that the January 1 work in process inventory includes direct materials of $4,578
determine the increase or decrease in the cost per equivalent unit for direct
materials and conversion between December and January.

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