Fabchip

specializes in the manufacture of ball bearings for aircraft. Direct materials are added at the start of the production process. Conversion costs are added evenly during the process. Some units of this 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.

Fabchip

uses the FIFO method of process costing. Summary data for September

2018

are:

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Required

1.	For each cost element, compute the equivalent units. Show physical units in the first column.
2.	For each cost element, calculate the cost per equivalent unit.
3.	Summarize 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.

Requirement

1.

For each cost element, compute the equivalent units. Show physical units in the first column.

Enter the physical units in first, and then calculate the equivalent units. (Round your answers to the nearest whole unit.)

	Physical
Flow of Production	Units
Work in process, beginning	1,250
Started during current period	3,000
To account for	4,250
Completed and transferred out during current period:
From beginning work in process	1,250
Started and completed	1,150
Normal spoilage	360
Abnormal spoilage	1,190
Work in process, ending	300
Accounted for	4,250
Work done in current period only

Equivalent Units
Direct	Conversion
Materials	Costs
0	875
1,150	1,150
360	360
1,190	1,190
300	135
3,000	3,710

Requirement 2 and 3. For each cost element, calculate the cost per equivalent unit. Summarize total costs to account for, calculate cost per equivalent unit for each cost category, and assign total costs to units completed and transferred out (including normal spoilage), to abnormal spoilage, and to units in ending work in process.

Begin by summarizing the total costs to account for.

		Total	Direct	Conversion
		Production Costs	Materials	Costs
Work in process, beginning		$115,740	$96,840	$18,900
Costs added in current period		872,750	582,500	290,250
Total costs to account for		$988,490	$679,340	$309,150

Next calculate cost per equivalent unit for direct materials and conversion costs. (Round your answers to four decimal places.)

		Direct	Conversion
		Materials	Costs
Costs added in current period		$582,500	$290,250
Divide by:	Equivalent units of work done in current period	3,000	3,710
Cost per equivalent unit		$194.1667	$78.2345

Now assign total costs to units completed and transferred out (including normal spoilage), to abnormal spoilage, and to units in ending work in process. (Complete all answer boxes. For accounts with a $0 balance, make sure to enter "0" in the appropriate column. Round your answers to the nearest whole dollar.)

		Total	Direct	Conversion
		Production Costs	Materials	Costs
Completed and transferred out:
Costs added to beginning inventory before normal spoilage
Normal spoilage
Total from beginning inventory before normal spoilage

Choose from any list or enter any number in the input fields and then click Check Answer.