oduction process. The only difference between the two coffees is the cost of the unroasted coffee beans. The following data are wailable for February: Number of pounds of coffee produced Cost of unroasted beans and packaging per pound Other costs: Direct labor Indirect materials Other overhead Conversion cost Materials cost Fotal cost umber of pounds Cost per pound Star Star 10,000 $ 4.90 equired: rganic Grounds uses operations costing and assigns conversion costs based on the number of pounds of coffee produced. Compute e cost unit of each brand of coffee produced in February. (Do not round intermediate calculations. Round "Cost per pound" to 2 ecimal places.) Bucks Bucks 40,000 $6.70 Total Total 50,000 $90,000 45,000 15,000

Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter16: Cost-volume-profit Analysis
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Problem 42P: Good Scent, Inc., produces two colognes: Rose and Violet. Of the two, Rose is more popular. Data...
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Organic Grounds produces two brands of coffee: Star and Bucks. The two coffees are produced in one factory using the same
production process. The only difference between the two coffees is the cost of the unroasted coffee beans. The following data are
available for February:
Number of pounds of coffee produced
Cost of unroasted beans and packaging per pound
Other costs:
Direct labor
Indirect materials
Other overhead
Conversion cost
Materials cost
Total cost
Number of pounds
Cost per pound
Star
Star
10,000
Bucks
40,000
$ 4.90 $ 6.70
Required:
Organic Grounds uses operations costing and assigns conversion costs based on the number of pounds of coffee produced. Compute
the cost unit of each brand of coffee produced in February. (Do not round intermediate calculations. Round "Cost per pound" to 2
decimal places.)
Bucks
Total
50,000
Total
$90,000
45,000
15,000
Transcribed Image Text:Organic Grounds produces two brands of coffee: Star and Bucks. The two coffees are produced in one factory using the same production process. The only difference between the two coffees is the cost of the unroasted coffee beans. The following data are available for February: Number of pounds of coffee produced Cost of unroasted beans and packaging per pound Other costs: Direct labor Indirect materials Other overhead Conversion cost Materials cost Total cost Number of pounds Cost per pound Star Star 10,000 Bucks 40,000 $ 4.90 $ 6.70 Required: Organic Grounds uses operations costing and assigns conversion costs based on the number of pounds of coffee produced. Compute the cost unit of each brand of coffee produced in February. (Do not round intermediate calculations. Round "Cost per pound" to 2 decimal places.) Bucks Total 50,000 Total $90,000 45,000 15,000
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