Transcribed TextTranscribed Text

Case 1. Hiebert Chocolate, Ltd., is located in Memphis. The company prepares gift boxes of chocolates for private parties and corporate promotions. Each order contains a pre-determined selection of chocolates that are distributed and sold by various retail stores. The chocolate gift boxes are made in a three stage production process: Mixing, Drying, and Packaging. In the Mixing Department, chocolate is melted and mixed with other ingredients. The Drying Department takes the melted mixture, forms it into various shapes, and dries the chocolates. The Packaging Department takes the dried chocolates and boxes them, just before they are sent to finished goods. Accordingly, Hiebert uses a process costing system. One of Hiebert's largest customers is Wal-Mart. This organization purchases roughly 80% of all Hiebert's products. The following data for the Packaging Department for March are available: Packaging Department Units: Beginning WIP-Units 10,000 Started in production 80,000 Transferred out 75,000 Ending WIP-Units 15,000 Beginning WIP-% complete 40% Ending WIP-% complete 80% Costs: Beginning WIP-Transferred-in costs $ 3,000 Beginning WIP-Materials costs $ - Beginning WIP-Conversion costs $ 1,630 Transferred-in costs $ 9,600 Direct materials-Packaging $21,000 Conversion costs: Direct labor $ 8,470 Manufacturing overhead $ 7,300 Total conversion costs $15,770 Ben Hiebert, president of Hiebert Chocolate, Ltd, is trying to determine whether to use a weighted-average or FIFO product costing system, since Hiebert's contract with Wal-Mart allows for a sales price of cost per department + 15%. Requirements 1. Consider only the Packaging Department data. Prepare cost of production reports using both weighted-average and FIFO process costing. 2. Which method should Heibert use and why?

Solution PreviewSolution Preview

This material may consist of step-by-step explanations on how to solve a problem or examples of proper writing, including the use of citations, references, bibliographies, and formatting. This material is made available for the sole purpose of studying and learning - misuse is strictly forbidden.

Production Report: Hiebert Chocolate Ltd.
    $25.00 for this solution

    PayPal, G Pay, ApplePay, Amazon Pay, and all major credit cards accepted.

    Find A Tutor

    View available Accounting Tutors

    Get College Homework Help.

    Are you sure you don't want to upload any files?

    Fast tutor response requires as much info as possible.

    Upload a file
    Continue without uploading

    We couldn't find that subject.
    Please select the best match from the list below.

    We'll send you an email right away. If it's not in your inbox, check your spam folder.

    • 1
    • 2
    • 3
    Live Chats