Normal and abnormal spoilage in units. The following data, in physical units, describe a grinding process for January:

Inspection occurs at the 100% completion stage. Normal spoilage is 5% of the good units passing inspection.
REQUIRED 1. Compute the normal and abnormal spoilage in units.
2. Assume that the equivalent-unit cost of a spoiled unit is $10. Compute the amount of potential savings if all spoilage were eliminated, assuming that all other costs would be unaffected. Comment on your answer.LO1

Transcribed Image Text:

Work in process, beginning Started during current period 19,000 150,000 To account for 169,000 Spoiled units 12,000 Good units completed and transferred out 132,000 Work in process, ending 25,000 Accounted for 169,000