Question
Concord Ready-mix applies process costing as it produces a single product in large volume. The process line (partial) for Mixing Department is given below: Compute
- Concord Ready-mix applies process costing as it produces a single product in large volume. The process line (partial) for Mixing Department is given below:
Compute cost of normal spoilage and show the shifting
63,000 Units
2,000 Units
4,000 Units
60,000 Units
0% |
20% |
30% |
40% |
50% |
70% |
80% |
100% |
DM |
DL |
IP 1 |
IP 2 |
OH |
Other Information:
At 20%, we have beginning inventory and at 80%, we have ending inventory. At 50%, a total of 66,000 units were inspected for rework. 1% of the units inspected are considered as normal rework. At 70%, we have inspection point for spoilage. 1% of input is considered as normal spoilage. Spoiled units can be scrapped at the rate of $3.
Costs per equivalent unit data are given below:
| Material | Labor | Overhead |
Cost per equivalent unit | $8 | $5 | $3 |
Required:
- Compute equivalent units for normal rework and normal spoilage under weighted average method.
- Compute cost of normal rework and show the shifting.
Step by Step Solution
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Step: 1
MALA Method D Unt 2 Computation equivalent unite for no weighted average Ste...Get Instant Access to Expert-Tailored Solutions
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