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Case #1 Whiteboard Inc. manufactures steel rods at a local production facility. The company has two production departments, machining and finishing. The company uses the
Case #1 Whiteboard Inc. manufactures steel rods at a local production facility. The company has two production departments, machining and finishing. The company uses the weighted-average method of process costing. In November, the following data were recorded for the finishing department: Direct materials SO Conversion Costs $26.250 Finishing Dept. Work-in-process, November 1 Started during November Good units completed and transferred out Spoiled units Work-in-process, November 30% Total costs added during November Physical Transferred- units in Costs 6,250 $52,000 43,750 31,250 6,250 12,500 $398,000 $409,500 $781,250 * Degree of completion direct materials, 0%; conversion costs, 20% Degree of completion direct materials. 100%; conversion costs, 90% Conversion costs are added evenly during the production process. Direct materials are added when production is 85% complete. The inspection point is at the 80% stage of production Normal spoilage is 10% of all goods that pass inspection Spoiled units are disposed of at zero net disposal value
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