LogicCo 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. LogicCO uses the FIFO method of process costing. Summary data and weighted-average data for September 2020 are as follows: Requirements :1.For each cost category, compute equivalent units. Show physical units in the first column.2.Summarize total costs to account for; calculate 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 's managers choose the weighted-average method or the FIFO method? Explain. a tableAWork in process, beginning inventory (September 1)Degree of completion of beginning work in processStarted during SeptemberGood units completed and transferred out duringSeptemberVork in process, ending inventory (September 30)Degree of completion of ending work in processotal costs added during Septemberormal spoilage as a percentage of good unitsDegree of completion of normal spoilageDegree of completion of abnormal spoilageQuestion 1PrintBPhysical Units(Computer Chips)Done900 $2,7542,50049015%$CDirectMaterials125,766 $100%DConversionCosts100%619,650 $100%100%10,36830%10%253,098100%100%Weighted-average dataCost per equivalent unit for work done to dateCost of units completed and transferred outAbnormal spoilageWork in process, endingTotal costs accounted forPrintTotal ProductionCosts$$$822,250 $82,654103,9781,008,882 $DoneDirectMaterials204.00 $586,500 $58,95699,960745,416 $ConversionCosts82.00235,75023,6984,018263,466

Process costing is a method where the products go through two or more processes. These costs are…

Answered: LogicCo is a fast-growing manufacturer…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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LogicCo 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. LogicCO uses the FIFO method of process costing. Summary data and weighted-average data for September 2020 are as follows: Requirements :1. For each cost category, compute equivalent units. Show physical units in the first column. 2. Summarize total costs to account for; calculate 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 's managers choose the weighted-average method or the FIFO method? Explain.

a table
A
Work in process, beginning inventory (September 1)
Degree of completion of beginning work in process
Started during September
Good units completed and transferred out during
September
Vork in process, ending inventory (September 30)
Degree of completion of ending work in process
otal costs added during September
ormal spoilage as a percentage of good units
Degree of completion of normal spoilage
Degree of completion of abnormal spoilage
Question 1
Print
B
Physical Units
(Computer Chips)
Done
900 $
2,754
2,500
490
15%
$
C
Direct
Materials
125,766 $
100%
D
Conversion
Costs
100%
619,650 $
100%
100%
10,368
30%
10%
253,098
100%
100%
Weighted-average data
Cost per equivalent unit for work done to date
Cost of units completed and transferred out
Abnormal spoilage
Work in process, ending
Total costs accounted for
Print
Total Production
Costs
$
$
$
822,250 $
82,654
103,978
1,008,882 $
Done
Direct
Materials
204.00 $
586,500 $
58,956
99,960
745,416 $
Conversion
Costs
82.00
235,750
23,698
4,018
263,466

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