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What are the total conversion costs of abnormal spoilage?

What are the total conversion costs of abnormal spoilage?

FINANCIAL ACCOUNTING
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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Electric Automotive Group is a maker of engines for high performance cars and uses a process costing system. The following information pertains to the final department of manufacturing for Electric's most popular engine, the "Atomic 8". Beginning work-in-process (40% completed) 400 Transferred-in 1,600 100 100 1,400 400 Normal spoilage Abnormal spoilage Good units transferred out Ending work-in-process (25% completed) Conversion costs in beginning inventory Current conversion costs A) $60,518 B) $53,454 C) $64,908 $180,500 $728,218 Electric Automotive Group calculates separate costs of spoilage by computing both normal and abnormal spoiled units. Normal spoilage costs are reallocated to good units and abnormal spoilage costs are charged as a loss. The units of the Atomic 8 that are spoiled are the result of defects not discovered before inspection of finished units. Using the weighted-average method, answer the following question: D) $58,314 units units What are the total conversion costs of abnormal spoilage? E) $54,456 units units units units
Transcribed Image Text:Electric Automotive Group is a maker of engines for high performance cars and uses a process costing system. The following information pertains to the final department of manufacturing for Electric's most popular engine, the "Atomic 8". Beginning work-in-process (40% completed) 400 Transferred-in 1,600 100 100 1,400 400 Normal spoilage Abnormal spoilage Good units transferred out Ending work-in-process (25% completed) Conversion costs in beginning inventory Current conversion costs A) $60,518 B) $53,454 C) $64,908 $180,500 $728,218 Electric Automotive Group calculates separate costs of spoilage by computing both normal and abnormal spoiled units. Normal spoilage costs are reallocated to good units and abnormal spoilage costs are charged as a loss. The units of the Atomic 8 that are spoiled are the result of defects not discovered before inspection of finished units. Using the weighted-average method, answer the following question: D) $58,314 units units What are the total conversion costs of abnormal spoilage? E) $54,456 units units units units
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