On the following two pages are two problems based on LetusPlay Manufacturing. Each problem is a separate scenario.

For each of the two problems, prepare two production cost reports (four reports in total) in an Excel spreadsheet: one report using weighted average inventory costing, the second using FIFO inventory costing.

Problem 1 - LetusPlay Manufacturing LetusPlay Manufacturing produces a plastic toy in a two-stage manufacturing operation. During the month of June, the following data were recorded for the Finishing Department Units in BWIP Percentage of BWIP completed Units started Spoiled units Units in EWIP Percentage of EWIP completed Costs in BWIP 30,000 25% 140,000 20,000 40,000 50% Transferred-in costs Direct materials Conversion costs S 143,400 152,600 $ 49,650 Costs added in the current period Transferred in Direct materials Direct labour Overhead 670,800 712,400 518,200 Direct materials are incurred at the beginning of the process. Conversion costs are incurred uniformly throughout the process. Overhead is applied at the rate of 75% of direct labour costs. Inspection occurs when production is 75% complete. Normal spoilage is 10% of all good units that pass inspection. Spoiled units are disposed of with no net disposal value. LetusPlay recognizes spoilage in determining equivalent units of output and assigns a share of the production costs to the spoiled units