Chapter 18, Problem 18.23E

FIFO method, spoilage, equivalent units. Refer to the information in Exercise 18-21. Suppose MacLean Manufacturing Company uses the FIFO method of process costing instead of the weighted-average method.

18-21 Weighted-average method, spoilage, equivalent units. (CMA, adapted) Consider the following data for November 2017 from MacLean Manufacturing Company, which makes silk pennants and uses a process-costing system. All direct materials are added at the beginning of the process, and conversion costs are added evenly during the process. Spoilage is detected upon inspection at the completion of the process. Spoiled units are disposed of at zero net disposal value. MacLean Manufacturing Company uses the weighted-average method of process costing.

^a Degree of completion: direct materials, 100%; conversion costs, 45%.

^b Degree of completion: direct materials, 100%; conversion costs, 35%.