Factory uses process costing to determine its product costs.

In its processing department:

• Direct material A is added at the beginning of the process.
• Direct material B is added when production is 90% complete.
• Conversion costs are added evenly throughout.
• The inspection point is at the 80% stage of production.
• Normal spoilage is 2% of all good units that pass inspection.

The following details are available for January production.

Beginning inventory

Number of units 4,500

Direct materials cost $22,500

Conversion cost $13,000

Per cent completion 65%

Month of January activity

Number of units started 25,000

Direct material A cost $160,000

Direct material B cost $354,000

Conversion costs $560,600

Number of units completed 22,000

Ending inventory 7,000

Per cent completion of ending inventory 40%

• The company uses the FIFO method.
• What is the cost of the abnormal spoilage for January?