Horngren's Cost Accounting: A Managerial Emphasis (16th Edition)
16th Edition
ISBN: 9780134475585
Author: Srikant M. Datar, Madhav V. Rajan
Publisher: PEARSON
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Textbook Question
Chapter 18, Problem 18.43P
Physical units, inspection at various stages of completion. Chemet manufactures chemicals in a continuous process. The company combines various materials in a specially configured machine at the beginning of the process, and conversion is considered uniform through the period. Occasionally, the chemical reactions among the materials do not work as expected and the output is then considered spoiled. Normal spoilage is 4% of the good units that pass inspection. The following information pertains to March 2017:
| Beginning inventory | 2,500 units (100% complete for materials; 25% complete for conversion costs) |
| Units started | 30,000 |
| Units in ending work in process | 2,100(100% complete for materials; 70% complete for conversion costs) |
| Chemet had 1,900 spoiled units in March 2017. | |
Required
Using the format on page 728, compute the normal and abnormal spoilage in units, assuming the inspection point is at (a) the 20% stage of completion, (b) the 45% stage of completion, and (c) the 100% stage of completion.
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Chemet manufactures chemicals in a continuous process. The company combines various materials in a specially configured machine at the beginning of the process, and conversion is considered uniform through the period. Occasionally, the chemical reactions among the materials do not work as expected and the output is then considered spoiled. Normal spoilage is 4% of the good units that pass inspection. The following information pertains to March 2017:
Beginning inventory = 2,500 units (100% complete for materials; 25% complete for conversion costs)
Units started = 30,000
Units in ending work in process = 2,100 (100% complete for materials; 70% complete for conversion costs)
Chemet had 1,900 spoiled units in March 2017.
compute the normal and abnormal spoilage in units, assuming the inspection point is at (a) the 20% stage of completion, (b) the 45% stage of completion, and (c) the 100% stage of completion.
Edwards manufactures small tables in its Processing Department. Direct materials are added at the initiation of the production cycle and must be bundled in single kits for each unit. Conversion costs are incurred evenly throughout the production cycle. Inspection occurs when units are 60% converted. Normal spoilage, if any, generally constitute 4% of the good units - units that successfully passed the inspection in current month. Company use Weighted Average method. Data for May 2021 are as follows: WIP, beginning inventory 5/1/2021 24,200 units Direct materials (100% complete) Conversion costs (75% complete)Started during December 83,600 unitsCompleted and transferred out 5/31/2021 79,200 unitsWIP, ending inventory 5/31/2021 19,800 units Direct materials (100% complete) Conversion costs (65% complete) Costs for December: WIP, beginning Inventory: Direct materials…
Outose Concept manufactures small tables in its Processing Department. Direct materials are added at the initiation of the production cycle and must be bundled in single kits for each unit. Conversion costs are incurred evenly throughout the production cycle. Before inspection, some units are spoiled due to non-detectible materials defects. Inspection occurs when units are 50% converted. Spoiled units generally constitute 4% of the good units. Data for December 2015 are as follows:
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Chapter 18 Solutions
Horngren's Cost Accounting: A Managerial Emphasis (16th Edition)
Ch. 18 - Why is there an unmistakable trend in...Ch. 18 - Distinguish among spoilage, rework, and scrap.Ch. 18 - Normal spoilage is planned spoilage. Discuss.Ch. 18 - Costs of abnormal spoilage are losses. Explain.Ch. 18 - What has been regarded as normal spoilage in the...Ch. 18 - Units of abnormal spoilage are inferred rather...Ch. 18 - In accounting for spoiled units, we are dealing...Ch. 18 - Total input includes abnormal as well as normal...Ch. 18 - Prob. 18.9QCh. 18 - The unit cost of normal spoilage is the same as...
Ch. 18 - In job costing, the costs of normal spoilage that...Ch. 18 - The costs of rework are always charged to the...Ch. 18 - Abnormal rework costs should be charged to a loss...Ch. 18 - When is a company justified in inventorying scrap?Ch. 18 - How do managers use information about scrap?Ch. 18 - Prob. 18.16MCQCh. 18 - Which of the following is a TRUE statement...Ch. 18 - Healthy Dinners Co. produces frozen dinners for...Ch. 18 - Fresh Products, Inc. incurred the following costs...Ch. 18 - Normal and abnormal spoilage in units. The...Ch. 18 - Weighted-average method, spoilage, equivalent...Ch. 18 - Weighted-average method, assigning costs...Ch. 18 - FIFO method, spoilage, equivalent units. Refer to...Ch. 18 - FIFO method, assigning costs (continuation of...Ch. 18 - Weighted-average method, spoilage. LaCroix Company...Ch. 18 - FIFO method, spoilage. 1. Do Exercise 18-25 using...Ch. 18 - Spoilage, journal entries. Plastique produces...Ch. 18 - Recognition of loss from spoilage. Spheres Toys...Ch. 18 - Weighted-average method, spoilage. LogicCo is a...Ch. 18 - FIFO method, spoilage. Refer to the information in...Ch. 18 - Standard-costing method, spoilage. Refer to the...Ch. 18 - Spoilage and job costing. (L. Bamber) Barrett...Ch. 18 - Reworked units, costs of rework. Heyer Appliances...Ch. 18 - Scrap, job costing. The Russell Company has an...Ch. 18 - Weighted-average method, spoilage. World Class...Ch. 18 - FIFO method, spoilage. Refer to the information in...Ch. 18 - Weighted-average method, shipping department...Ch. 18 - FIFO method, shipping department (continuation of...Ch. 18 - Physical units, inspection at various levels of...Ch. 18 - Spoilage in job costing. Jellyfish Machine Shop is...Ch. 18 - Rework in job costing, journal entry (continuation...Ch. 18 - Scrap at time of sale or at time of production,...Ch. 18 - Physical units, inspection at various stages of...Ch. 18 - Weighted-average method, inspection at 80%...Ch. 18 - Job costing, classifying spoilage, ethics....
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