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Craft Concept manufactures small tables in its Processing Department. Direct materials are added at the initiation of the production cycle and must be bundled
Craft Concept manufactures small tables in its Processing Department. Direct materials are added at the initiation of the production cycle and must be bundled in single kits for each unit. Conversion costs are incurred evenly throughout the production cycle. Before inspection, some units are spoiled due to nondetectible materials defects. Inspection occurs when units are 50% converted. Spoiled units generally constitute 5% of the good units. Data for December 2012 are as follows: WIP, beginning inventory 12/1/2012 Direct materials (100% complete) 20,000 units Conversion costs (75% complete) Started during December 80,000 units Completed and transferred out 12/31/2012 76,800 units 16,000 units WIP, ending inventory 12/31/2012 Direct materials (100% complete) Conversion costs (65% complete) Costs for December: WIP, beginning Inventory: Direct materials Conversion costs Direct materials added Conversion costs added $ 100,000 60,000 200,000 280,000 What cost is allocated to abnormal spoilage using the weighted-average process- costing method? O $32,800 O $14,720 $ 0 O $22,176
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