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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 $(600$ units, $3/5$ completed$)$:Direct materials $(600$ $$2\mathrm{.}25)$$$1,350$Conversion $(6003/5$ $$0\mathrm{.}40)144$$$1,494$

The following costs were charged to Work in Process$-$Sifting Department during July:

Direct materials transferred from Milling Department:$15,400$ units at $$2\mathrm{.}35$ a unit$$36,190$Direct labor$4,420$Factory overhead$2,474$

During July, $14,400$ units of flour were completed. Work in Process$-$Sifting Department on July $31$ was $1,600$ units, $$completed$.$

Required:$1.$Prepare a cost of production report for the Sifting Department for July. If an amount is zero, enter $"0".$ Round your Cost per equivalent unit answers to two decimal places$\mathrm{.}2.$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 the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered$\mathrm{.}3.$Determine the increase or decrease in the cost per equivalent unit$$from June to July for direct materials and conversion costs. Enter all amounts as positive numbers. Round your answers to two decimal places$\mathrm{.}4.$Discuss the uses of the cost of production report and the results of part $(3).$ CHART OF ACCOUNTSWhite Diamond Flour CompanyGeneral Ledger

ASSETS$110$Cash$121$Accounts Receivable$125$Notes Receivable$126$Interest Receivable$131$Materials$141$Work in Process$-$Milling Department$142$Work in Process$-$Sifting Department$143$Work in Process$-$Packaging Department$151$Factory Overhead$-$Milling Department$152$Factory Overhead$-$Sifting Department$153$Factory Overhead$-$Packaging Department$161$Finished Goods$171$Supplies$172$Prepaid Insurance$173$Prepaid Expenses$181$Land$191$Factory$192$Accumulated Depreciation$-$Factory

LIABILITIES$210$Accounts Payable$221$Utilities Payable$231$Notes Payable$236$Interest Payable$251$Wages Payable

EQUITY$311$Common Stock$340$Retained Earnings$351$Dividends

REVENUE$410$Sales$610$Interest Revenue

EXPENSES$510$Cost of Goods Sold$520$Wages Expense$531$Selling Expense$532$Insurance Expense$533$Utilities Expense$534$Supplies Expense$540$Administrative Expense$561$Depreciation Expense$-$Factory$590$Miscellaneous Expense$710$Interest Expense. $1.$ Prepare a cost of production report for the Sifting Department for July. If an amount is zero, enter $"0".$ Round your Cost per equivalent unit answers to two decimal places.

WHITE DIAMOND FLOUR COMPANYCost of Production Report$-$Sifting DepartmentFor the Month Ended July $31$UNITSWhole UnitsEquivalent UnitsDirect MaterialsConversionUnits charged to production:$$Inventory in process, July $1$

Received from Milling Department

$$Total$$units$$accounted$$for$$by$$the$$Sifting$$Department

Units to be assigned costs:$$Inventory$$in$$process$,$July$1(3/5$completed$)$

$$Started and completed in July

$$Transferred to Packaging Department in July

$$Inventory in process, July $31(4/5$ completed$)$

$$Total units to be assigned costs

COSTSCostsDirect MaterialsConversionTotalCost per equivalent unit:$$Total$$costs$$for$$July$$in$$Sifting$$Department

Total equivalent units$$

$$

$$Cost per equivalent unit

Costs assigned to production:$$Inventory in process, July $1$

$$Costs incurred in July

$$Total$$costs$$accounted$$for$$by$$the$$Sifting$$Department

Cost allocated to completed andpartially completed units:$$Inventory in process, July $1$ balance

$$To complete inventory in process, July $1$

$$Cost of completed July $1$ work in process

Started and completed in July

Transferred to Packaging Department in July

Inventory in process, July $31$

Total costs assigned by the Sifting Department. $2.$ 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 the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered.

PAGE $10$

JOURNAL

ACCOUNTING EQUATION

DATEDESCRIPTIONPOST. REF.DEBITCREDITASSETSLIABILITIESEQUITY

$1$

$$

$2$

$$

$3$

$$

$4$

$$Determine the increase or decrease in the cost per equivalent unit from June to July for direct materials and conversion costs. Enter all amounts as positive numbers. Round your answers to two decimal places. Direct materials: $ Conversion: $

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