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CoursHeroTranscribedText: 19-45. JOB COSTING, CLASSIFYING SPOILAGE, ETHICS. Flextron Company is a contract manufacturer for a variety of pharmaceutical and over-the-counter products. Lynn Sanger, one of Flextron's quality control managers, obtains the following information for Job No. M102. The order was completed recently, just before the close of Flextron's fiscal year. The units will be delivered early in the next accounting period. A total of 128,500 units were started, and 6,000 spoiled units were rejected at final inspection, yielding 122,500 good units. Normal spoilage is 2,500 units. Spoiled units were sold at $4 per unit. Sanger indicates that all spoilage was related to this specific job. The total costs for all 128,500 units of Job No. M102 follow. The job has been completed, but the costs are yet to be transferred to Finished Goods. Direct materials $ 979,000 Direct manufacturing labor 840,000 Manufacturing overhead 1,650,500 Total manufacturing costs $3.469,500 Required 1. Calculate the unit quantities of normal and abnormal spoilage. 2. Prepare journal entries to account for Job No. M102, including spoilage, disposal of spoiled units, and transfer of costs to the Finished Goods account. 3. Flextron's controller, Vince Chadwick, tells Marta Suarez, the management accountant responsible for Job No. M102, the following: "This was an unusual job. I think all 6,000 spoiled units should be considered normal." Suarez knows that the work involved in Job No. M102 was typical and that normal spoilage is 2,500 units. She feels Chadwick made these comments because he wants to show a higher operating income for the year. a. Prepare journal entries, similar to requirement 2, to account for Job No. M102 if all spoilage were considered normal. How will operating income be affected if all spoilage is considered normal? b. What should Suarez do in response to Chadwick's comment

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