Recording spoiled and defective goods. The Newton Corporation produced 500 units of Job 451 at a unit cost of $15 each. On January 4, 19X8, inspection shows that 17 units have defects and have an estimated sales value of only $6 each.

Instructions Use the account names found in your textbook to do the following:

1.

a. Assume that the units are spoiled. Prepare the general journal entry to record the estimated market value of the rejected units as a debit to Spoiled Goods Inventory. Assume that the spoilage costs are to be charged to Manufacturing Overhead Control.

b. Compute the unit cost of the remaining finished units.
2.

a. Prepare the general journal entry to record the estimated market value of the rejected units. Assume that the spoilage costs are to be absorbed in the cost of the specific job.

b. Compute the unit cost of the remaining finished units.
3. Assume that the units are defective instead of spoiled. Prepare the general journal entry to record the total rework costs of $35. Also assume that Job 470 is assigned to the necessary rework. The rework is completed on January 4, and the rework costs are to be charged to Manufacturing Overhead Control.