Question

McKee Foods, Inc., manufactures snack cakes under the brand name Little Debbie. Production of Swiss cake rolls occurs in four departments: mixing, baking, icing, and drying and packaging. Consider the mixing department, where direct materials are added at the beginning of the process. Conversion costs are added evenly during the process. The accounting records of a McKee Foods plant provide the following information for Swiss cake rolls in its mixing department during a weekly period (week 31):


aDegree of completion: direct materials, ?%; conversion costs, 20%.
bDegree of completion: direct materials, ?%; conversion costs, 40%.

1. Using the weighted- average method, summarize the total mixing department costs for week 31, and assign total costs to units completed ( and transferred out) and to units in ending work in process.
2. Assume that the FIFO method is used for the mixing department. Summarize the total mixing department costs for week 31, and assign total costs to units completed and transferred out and to units in ending work in process using the FIFO method.
3. McKee management seeks to have a more consistent cost per equivalent unit. Which method of process costing should the company choose andwhy?


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  • CreatedJanuary 15, 2015
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