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Philco Fire Alarms manufactures Fire Alarms in their factory that uses a process requiring two departments. The production starts in the 3D Printing Department and is completed in the Assembly Department. In the Assembly Department direct materials are added at various points while conversion costs are incurred proportionally throughout the production process. This question focuses on the Assembly Department. Philco uses the FIFO method of process costing for both departments. Assembly Department - Beginning WIP and February Production: On February 1, the Assembly Department had 5,000 units in production (previously transferred in from the 3D Printing Department). These units were 50% complete with respect to direct materials and 70% complete with respect to conversion. During February, 40,000 units were transferred from the 3D Printing Department to the Assembly Department. By the end of February, a total of 40,200 units were completed and transferred to finished goods inventory. Assembly Department - Ending WIP: The 3,500 units in ending work in process at the end of February are 70% complete with respect to direct materials and 50% complete with respect to conversion. These units have not yet been inspected for spoilage. Assembly Department - Spoilage: 500 units started during February were spoiled (this is within the expected range of normal spoilage) and discarded. The inspection took place after all direct materials were added and with 50% of conversion completed. 800 units started in February were destroyed in a fire when they vere 40% complete with respect to direct materials and 30% complete with respect to conversion Department B - Manufacturing Costs: he cost sheet for the Assembly Departmentshows that the 5,000 units in production on bruary 1 carried over costs of $5,000 for transferred in units, $2,500 for direct materials, and , 500 in conversion costs. During February, transferred in costs were $30,000, the cost of dire On February 1 , the Assembly Department had 5,000 units in production (previously transferred in from the 3D Printing Department). These units were 50% complete with respect to direct materials and 70% complete with respect to conversion. During February, 40,000 units were transferred from the 3D Printing Department to the Assembly Department. By the end of Assembly a total of 40,200 units were completed and transferred to finished goods inventory. Assembly Department - Ending WIP: The 3,500 units in ending work in process at the end of February are 70% complete with respect to direct materials and 50% complete with respect to conversion. These units have not yet been inspected for spoilage. Assembly Department - spoilage: 500 units started during February were spoiled (this is within the expected range of normal spoilage) and discarded. The inspection took place after all direct materials were added and with 60% of conversion completed. 800 units started in February were destroyed in a fire when they were 40% complete with respect to direct materials and 30% complete with respect to conversion. Department B - Manufacturing Costs: The cost sheet for the Assembly Department_shows that the 5,000 units in production on February 1 carried over costs of $5,000 for transferred in units, $2,500 for direct materials, and $3,500 in conversion costs. During February, transferred in costs were $30,000, the cost of direct materials added were $16,000, and conversion costs added were $20,000. Required - for the Assembly Department: 1) prepare an Equivalent Unit report (calculate with at least 4 decimal points and round all nswers to the nearest unit). ( 18 marks)
