Weighted-average method, spoilage. Superchip specializes in the manufacture of microchips for aircraft. Direct materials are added at the start of the production process.

Conversion costs are added evenly during the process. Some units ofthis product are spoiled as a result of defects not detectable before inspection of finished goods. Normally, the spoiled units are 15 % of the good units transferred out. Spoiled units are disposed of at zero net disposal price.

Superchip uses the weighted-average method of process costing. Summary data for September 2007 are Physical Units Direct Conversion

(Microchips) Materials Costs Work in process, September 1*

Started in September 2007 Good units completed and transferred out during September 2007 Work in process, September 30t Costs added during September 2007 400 $ 76,800 $ 12,240 1,700 1,400 300

$453,600 $184,320

*Degree of completion: direct materials, 100%; conversion costs, 30%.

fDegree of completion: direct materials, 100%; conversion costs, 40%.

Required 1. For each cost element, compute the equivalent units. Show physical units in the first 2.

3.

column.

For each cost element, calculate the cost per equivalent unit.

Summarize the total costs to account for, and assign these costs to units completed and transferred out (to normal spoilage), to abnormal spoilage, and to units in ending work in process.