(30 MARKS) QUESTION 3 Home & Gardening Supplies manufactures decorative flowerpots by way of four consecutive processes: Moulding, Baking, Spraying & Packing. In the Moulding Department, clay dough is kneaded and shaped into the form of a flowerpot. In the Baking Department the moulded pots are placed in a kiln for drying. In the Spraying Department the flowerpots are sprayed into various colours and then sent to the Packing Department where they are placed into cartons and sent to the Finished Goods warehouse. The following data relates to the Spraying Department for the month of February During February, 2,000 flowerpots valued at $321.10 each were transferred from the Baking Department to the Spraying Department. Other costs incurred during the month were Direct Materials Added $212,500 $274,400 $232,600 Direct Labour Manufacturing Overhead Normal losses are estimated to be 5% of the units transferred in from Baking. Inspection takes place during the spraying operation, at which point bad flowerpots are separated from good flowerpots and sold as scrap at $380 each At inspection, 300 flowerpots were rejected as scrap. These units had reached the following degree of completion Transfer from Baking Direct materials added Conversion costs 100% 80% 50% Work-in-progress at the end of February was 400 flowerpots and had reached the following degree of completion Transfer from Baking Direct materials added Conversion costs 100% 60% 40% There was no flowerpot in the Spraying Department at the beginning of the period Direct materials added and conversion costs are incurred uniformly throughout the process. Required: (a) Prepare a statement of equivalent production to determine the equivalent units for direct materials (From Baking & Direct Material Added), and conversion costs (6 marks) (b) Calculate the: Cost per equivalent unit for direct materials and conversion costs. - Cost of abnormal losses - Total cost of units completed and transferred to the Packing Department - Cost of ending work-in-process inventory in the Spraying Department (7 marks) (c) Prepare the Work-In-Process Inventory Spraying Department T-account, clearly showing the ending balance. (6 marks) (d) Prepare the journal entries for the use of total direct materials, direct labour incurred, manufacturing overhead applied and the cost of the flowerpots completed and transferred out to the Packing Department. (5 marks) (3 marks) (3 marks) (e) Given that 40 of the unexpected losses were as a result of pilferage, calculate Home & Gardening Supplies true loss for the month of February (f Briefly explain three differences between a job costing and a process costing system