Question

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 (850 units, 3/5 completed): Direct materials (850 × $2.15) $1,828 Conversion (850 × 3/5 × $0.50) 255 $2,083 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 4,029 During July, 15,050 units of flour were completed. Work in Process-Sifting Department on July 31 was 1,300 units, 45 completed. Required: 1. Prepare a cost of production report for the Sifting Department for July. If required, round your cost per equivalent unit answers to two decimal places. If an amount is zero, enter zero “0”. 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 correct wording of account titles. 3. Determine the increase or decrease in the cost per equivalent unit from June to July for direct materials and conversion costs. If required, round your answers to two decimal places. 4. Discuss the uses of the cost of production report and the results of part (3).

Answer 1