Question 1 (31 marks) Fong's Technology Company manufactures a chemical product. Each product will pass through Department X which is the final process of production. Direct materials are added when the process is 95% complete and conversion costs are added evenly during the process. Inspection occurs at the 60% stage of production. Normal spoilage is 10% of all good units that pass inspection. Spoilage units are disposed of at zero net disposal value. The company adopts the first-in-first out (FIFO) method of process costing. Data for Department X in March 2019 are as follows: Physical Transferred Dire Conversion -in costs materials units costs Work in process, beginning, March Started during March Good units completed and transferred out during March Work in process, ending 31 March Total costs added during March Degree of completion of beginning work in process Degree of completion of closing work in process 3.750 $232,650 $200,000 $187,750 268,750 243.750 35,000 940,625 731,250 S2,526,250 90% 80% Required For March 2019, show the physical units and compute the equivalent units for each of the cost category a) (10 marks) b) Also for March 2019, summarize total costs to account for and assign these costs to: (15 marks) (i) units completed and transferred out (including normal spoilage) (i) abnormal spoilage: (ii) unit in ending working in process. c) . What is the major advantage of using the FIFO method for purposes (2 marks) of planning and control? ii. "Costs of normal spoilage are planned costs and costs of abnormal 4 marks) spoilage are losses." Do you agree? Explain Question 1 (31 marks) Fong's Technology Company manufactures a chemical product. Each product will pass through Department X which is the final process of production. Direct materials are added when the process is 95% complete and conversion costs are added evenly during the process. Inspection occurs at the 60% stage of production. Normal spoilage is 10% of all good units that pass inspection. Spoilage units are disposed of at zero net disposal value. The company adopts the first-in-first out (FIFO) method of process costing. Data for Department X in March 2019 are as follows: Physical Transferred Dire Conversion -in costs materials units costs Work in process, beginning, March Started during March Good units completed and transferred out during March Work in process, ending 31 March Total costs added during March Degree of completion of beginning work in process Degree of completion of closing work in process 3.750 $232,650 $200,000 $187,750 268,750 243.750 35,000 940,625 731,250 S2,526,250 90% 80% Required For March 2019, show the physical units and compute the equivalent units for each of the cost category a) (10 marks) b) Also for March 2019, summarize total costs to account for and assign these costs to: (15 marks) (i) units completed and transferred out (including normal spoilage) (i) abnormal spoilage: (ii) unit in ending working in process. c) . What is the major advantage of using the FIFO method for purposes (2 marks) of planning and control? ii. "Costs of normal spoilage are planned costs and costs of abnormal 4 marks) spoilage are losses." Do you agree? Explain