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Acct306 Homework Ch18

# Acct306 Homework Ch18 - CHAPTER 18 SPOILAGE REWORK AND...

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18-1 CHAPTER 18 SPOILAGE, REWORK, AND SCRAP 18-30 Weighted-average method, spoilage. Solution Exhibit 18-30 summarizes total costs to account for, calculates the equivalent units of work done to date for each cost category, and assigns total costs to units completed (including normal spoilage), to abnormal spoilage, and to units in ending work in process using the weighted-average method. SOLUTION EXHIBIT 18-30 Weighted-Average Method of Process Costing with Spoilage; Cleaning Department of the Boston Company for May. PANEL A: Steps 1 and 2—Summarize Output in Physical Units and Compute Output in Equivalent Units (Step 1) (Step 2) Equivalent Units Flow of Production Physical Units Direct Materials Conversion Costs Work in process, beginning (given) Started during current period (given) To account for Good units completed and transferred out during current period: Normal spoilage* 2,050 × 100%; 2,050 × 100% Abnormal spoilage 1,250 × 100%; 1,250 × 100% Work in process, ending (given) 4,200 × 100%; 4,200 × 30% Accounted for Equivalent units of work done to date 3,000 25,000 28,000 20,500 2,050 1,250 4,200 28,000 20,500 2,050 1,250 4,200 28,000 20,500 2,050 1,250 1,260 25,060 *Normal spoilage is 10% of good units transferred out: 10% × 20,500 = 2,050 units. Degree of completion of normal spoilage in this department: direct materials, 100%; conversion costs, 100%. Total spoilage = 3000 + 25,000 – 20,500 – 4,200 = 3,300 units; Abnormal spoilage = 3,300 – 2,050 = 1,250 units. Degree of completion of abnormal spoilage in this department: direct materials, 100%; conversion costs, 100%. Degree of completion in this department: direct materials, 100%; conversion costs, 30%.

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