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Direct materials are added at the beginning of production. Conversion costs are incurred evenly throughout production . Spoiled units are detected at inspection, which occurs
Direct materials are added at the beginning of production. Conversion costs are incurred evenly throughout production . Spoiled units are detected at inspection, which occurs at the end of the production process. Normal spoilage is 5% of the good united completed and transferred out. Any spoilage over this amount is abnormal spoilage
Physical Units Degree of Completion Material Conversion Beginning Work-In- Process 20,000 75% $100,000 $60,000 Started During the 80,000 Period Ending Work-In- 16,000 65% Process Good Units Completed 76,800 and Transferred Total Costs Added During the Period $200,000 $280,000
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