Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

MicroMem is a fast-growing manufacturer of computer chips. Direct materials are added at the start of the production process. Conversion costs are added evenly during

MicroMem is a fast-growing manufacturer of computer chips. 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. Spoiled units are disposed of at zero net disposal value. MicroMem uses the FIFO method of process costing. Summary data and weighted-average data for September 2017 are as follows:

image text in transcribedimage text in transcribedimage text in transcribed

A D B Physical Units (Computer Chips) Direct Materials Conversion Costs 1 1,100 $ 216,588 $ 14,844 3 100% 30% 2,806 2,700 510 2 Work in process, beginning inventory (September 1) Degree of completion of beginning work in process 4 Started during September 5 Good units completed and transferred out during September 6 Work in process, ending inventory (September 30) Degree of completion of ending work in process 8 Total costs added during September 9 Normal spoilage as a percentage of good units 10 Degree of completion of normal spoilage 11 Degree of completion of abnormal spoilage 7 100% 30% 572,424 $ 283,272 15% 100% 100% 100% 100% Total Production Direct Conversion Costs Materials Costs $ 202.00 $ 84.00 Cost per equivalent unit for work done to date 888,030 $ 627,210 $ 260,820 Cost of units completed and transferred out Abnormal spoilage 83,226 58,782 24,444 Work in process, ending 115,872 103,020 12,852 Total costs accounted for $ 1,087,128 $ 789,012 $ 298,116 1. For each cost category, compute equivalent units. Show physical units in the first column of your schedule. 2. Summarize the total costs to account for; calculate the cost per equivalent unit for each cost category; and assign costs to units completed and transferred out (including normal spoilage), to abnormal spoilage, and to units in ending work in process. 3. Should MicroMem's managers choose the weighted-average method or the FIFO method? Explain briefly

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Implementing Standardized Work Training And Auditing

Authors: Alain Patchong

1st Edition

146656363X, 978-1466563636

More Books

Students also viewed these Accounting questions

Question

What is a fundamental weakness of a constant sum or ranking scale?

Answered: 1 week ago

Question

1. Calculate the sample correlation of XXX and ZZZ

Answered: 1 week ago