Question 2 (25 marks) Seng Seng Limited uses a process costing system and the FIFO cost-flow assumption. Production begins in the crafting department where materials are added at the beginning of the process and conversion costs are incurred uniformly throughout the process. On 1 October, beginning work in process consisted of 20,000 units which were 70% complete and had a cost of $350,000, $100,000 of which were materials costs. During October, the following occurred: Materials added $450,000 Conversion costs incurred $135,000 Units completed and transferred out in October 50,000 units Units in ending work in process 31 October (30% complete) 30,000 units Required: (a) Calculate the equivalent units of production for materials and conversion costs in the crafting department for the month of October (4 marks) (b) Determine the costs assigned to the ending work in process on 31 October (4 marks) (c) Determine the costs assigned to units completed and transferred out during October. (5 marks) (d) Controllable losses and non-controllable losses and gains may occur in manufacturing processes. Identify and define three possible and general types of process losses and gains. (3 marks) (e) Explain the need for equivalent units and why separate equivalent-unit totals are calculated for direct materials and conversion cost. (6 marks) (1) If an examination of goods in production at the end of the period revealed 30,000 units that are on average, 70% complete, would it be correct to say that 21,000 units were finished during the period? Why? (3 marks) [Total for Question 2: 25 marks]