Incorporated manufactures medium-size desks in its Processing Department. Direct materials are added at the initiation of...

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Incorporated manufactures medium-size desks in its ProcessingDepartment. Direct materials are added at the initiation of thecycle. Conversion costs are incurred evenly throughout theproduction cycle. Before inspection, some products are spoiled dueto non-detectible defects. Inspection occurs at the end of theprocess. Spoiled desks generally constitute 10% of the good units.Data for March 2019 are as follows: WIP, beginning inventory3/1/2019 30,000 Units Direct materials (100% complete) Conversioncosts (50% complete) Started during March 80,000 Units Completedand transferred out 3/31/2019 85,000 Units WIP, ending inventory3/31/2019 7,500 Units Direct materials (100% complete) Conversioncosts (20% complete) Costs for March: WIP, beginning Inventory:Direct materials $ 40,000 Conversion costs 75,000 Direct materialsadded 415,000 Conversion costs added 417,000

Q1) What is the number of total spoiled units?

Q2) Normal spoilage totals ________.

Q3) Abnormal spoilage totals ________.

Q4) What is the total cost per equivalent unit using theFirst-In-First Out method of process costing?

Q5) What cost is allocated to abnormal spoilage using theFirst-In-First Out method?

Q6) What is the amount of direct materials and conversion costsassigned to ending work in process using the First-In-First Outmethod?

Q7) What is the cost assigned to units completed and transferredout using the First-In-First Out method??

PLEASE: (Answer the questions with the details)

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STATEMENT OF EQUIVALENT PRODUCTION

INPUT DETAILS UNITS OUTPUT DETAILS UNITS EQUIVALENT UNITS UNITS EQUIVALENT UNITS UNITS
MATERIAL 100% CONVERSION COST
OPENING WIP 30000 COMPLETED AND TRANSFERRED 85000 85000 85000
UNITS INTRODUCED 80000 NORMAL LOSS 10% OF GOOD UNITS MEAN 8500 NIL NIL
ABNORMAL LOSS 9000 9000 100% 1800 20%
CLOSING WIP 7500 7500 100% 1500 20%
TOTAL 110000 110000 101500 88300

STATEMENT OF COST

DETAILS COST AT THE BEGINING OF PROCESS COST ADDED TOTAL COST EQUIVALENT PRODUCTION COST PER UNIT

MATERIAL

CONVERSION COST

40000

75000

415000

417000

455000

492000

101500

88300

4.48

5.57

STATEMENT OF DISTRIBUTION OF COST

1. COMPLETED AND TRANSFERRED GOODS [email protected] 854250

2. ABNORMAL LOSS 9000 UNITS

MATERIAL 100% [email protected] 40320

CONVERSION COST 20% [email protected] 10026 50346

3. CLOSING WIP 7500 UNITS

MATERIAL 100% [email protected] 33600

CONVERSIO 20% [email protected] 8355 41955

1. TOTAL NO OF SPOILED UNITS 16500

NORMAL WASTAGE 7500

ABNORMAL WASTAGE 9000


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