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(11 Marks) The Warner Company produces expensive sunglassess and uses a process-costing system (Weighted Avg Method). Direct materials are added at the beginning of
(11 Marks) The Warner Company produces expensive sunglassess and uses a process-costing system (Weighted Avg Method). Direct materials are added at the beginning of the process. Conversion costs are added evenly throughout the process (Ending WIP 75% complete). Consider the following data: WIP (Beg) Spoiled Units Units DM ($). Conv ($) 20,000 $550,000 ??? Goods Completed and transferred out 110,000 Started in month WIP (End) Costs Added in Month 120,000 10,000 $130,000 $4,200,000 $2,600,000 Normal Spoilage: 15% of Good Units Transferred; Inspection occurs when product is completed REQUIRED: a. Determine the # normal and abnormal spoilage (physical units) produced in period b. Compute the equivalent # of units for the current period c. Calculate costs per Equivalent Unit
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