1. Is the spoilage a normal or an abnormal spoilage? - Normal or Abnormal2. What is the EUP for materials?3. How many units were transferred out?4. What is the EUP for conversion costs? Diligent Manufacturing produces product 2AB and uses the FIFO method in its EUP computations. All directmaterial is entered at the beginning of the process. Some shrinkage occurs during the production process, butany shrinkage of less than 3 percent to be normal. October 2021 data are as follows:Beginning WIP inventory(60% complete as to material; 80% complete as to conversion)Started during OctoberEnding WIP inventory(40% complete as to material; 20% complete as to conversion)20,000 pounds180,000 pounds15,000 poundsFSDuring the month 4,800 gallons were spoiled.

Since you have asked multiple questions under a single question as theory regarding spoilage and…

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Business

Accounting

1. Is the spoilage a normal or an abnormal spoilage? - Normal or Abnormal

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

1. Is the spoilage a normal or an abnormal spoilage? - Normal or Abnormal

2. What is the EUP for materials?

3. How many units were transferred out?

4. What is the EUP for conversion costs?

Diligent Manufacturing produces product 2AB and uses the FIFO method in its EUP computations. All direct
material is entered at the beginning of the process. Some shrinkage occurs during the production process, but
any shrinkage of less than 3 percent to be normal. October 2021 data are as follows:
Beginning WIP inventory
(60% complete as to material; 80% complete as to conversion)
Started during October
Ending WIP inventory
(40% complete as to material; 20% complete as to conversion)
20,000 pounds
180,000 pounds
15,000 pounds
FS
During the month 4,800 gallons were spoiled.

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