Self-Study Problem 6-1 Weighted-Average Method versus FIFO Method

Smith Electronic Companys chip-mounting production department had 300 units of unfinished product, each 50% completed on September 30. During October of the same year, this department put another 900 units into production and completed 1,000 units and transferred them to the next production department. At the end of October, 200 units of unfinished product, 70% completed, were recorded in the ending Work-in-Process Inventory. Smith Electronic introduces all direct materials when the production process is 60% complete. Direct labor and factory overhead (i.e., conversion) costs are added uniformly throughout the process.

Following is a summary of production costs incurred during October:

	Direct Materials				Conversion Costs
Beginning work-in-process					$	2,816
Costs added in October	$	9,700				7,500
Total costs	$	9,700			$	10,316

Prepare a production cost report for October using the weighted-average method. (Round your answers to the nearest whole dollar amount. Round "Cost per equivalent unit" to 2 decimal places.)

SMITH ELECTRONIC COMPANY
Chip-Mounting Production Department Weighted-Average Production Cost Report
Production Quantity Information
	Step 1: Analyze Flow of Physical Units			Step 2: Calculate Equivalent Units
	Physical Units	Completion Percentage		Direct Materials	Conversion
Input
Beginning work-in-process inventory	300
Direct materials			%
Conversion			%
Started this period
Total to account for	300
Output
Completed			%
Ending work-in-process inventory
Completion percentage
Direct materials			%
Conversion			%
Total accounted for	0
Total work done to date (Total equivalent units)				0	0
Unit Cost Determination
Step 3: Determine Costs to Account for		Total Direct Materials		Conversion Costs	Total
Beginning work-in-process inventory
Current costs (costs added during this period)
Total costs to account for		$0		$0	$0
Step 4: Compute Unit Costs
Cost per equivalent unit
Cost Assignment
Step 5: Assign Total Manufacturing Costs		Completed and Transferred Out		Ending Work-in-Process	Total
Units completed and transferred out
Ending work-in-process
Materials
Conversion
Total costs accounted for				$0	$0

2.

1. Summarize your answers from Requirement 1 using weighted-average process costing: a. Equivalent units of direct materials and conversion. b. Equivalent unit costs of direct materials and conversion. (Round intermediate calculations to two decimal places.) c. Cost of goods completed and transferred out during the period. (Round intermediate calculations to two decimal places.) d. Cost of Work-in-Process Inventory at the end of the period. (Round intermediate calculations to two decimal places.)

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		Direct Materials	Conversion
a.	Equivalent units
b.	Equivalent unit costs
c.	Cost of goods completed and transferred out
d.	Cost of ending work-in-process

3.

Repeat requirement 1 using the FIFO method. (Round your answers to the nearest whole dollar amount. Round "Cost per equivalent unit" to 2 decimal places.)

SMITH ELECTRONIC COMPANY
Chip-Mounting Production Department FIFO Production Cost Report
Production Quantity Information
	Step 1: Analyze Flow of Physical Units		Step 2: Calculate Equivalent Units
	Physical Units	Direct Materials	Conversion Costs
Input
Beginning work-in-process inventory
Completion percentage
Direct materials
Conversion
Started this period
Total units to account for	0
Output
Completed
Ending work-in-process inventory
Completion percentage
Direct materials
Conversion
Total units accounted for	0	0	0
Total work performed to date
Beginning work-in-process inventory
Total work performed this period (FIFO equivalent units)		0	0
Unit Cost Determination
Step 3: Determine Total Costs to Account for Flow	Direct Materials	Conversion Costs	Total
Beginning work-in-process inventory
Current cost (costs added during this period)
Total costs to account for	$0	$0	$0
Step 4: Compute Unit Costs
Cost per equivalent unit
Cost Assignment
Step 5: Assign Total Manufacturing Costs	Completed and Transferred Out	Ending Work-in-Process	Total
Units completed and transferred out
Beginning work-in-process
Current cost to complete
Materials
Conversion
Total from beginning work-in-process	$0		$0
Units started and finished
Total cost completed and transferred out
Ending work-in-process
Materials
Conversion
Total costs accounted for		$0	$0

4.

Summarize your answers from Requirement 3 using the FIFO method. (Round "Cost per equivalent unit" answers to 2 decimal places.)

		Direct Materials	Conversion
a.	Equivalent units
b.	Equivalent unit costs
c.	Cost of goods completed and transferred out
d.	Cost of ending work-in-process