Problem B Ramsha Industries makes rocking chairs. The chairs are assembled in the Assembly Department and stained and sealed in the Finishing Department. Chairs are tested for quality in the Assembly Department before being transferred to Finishing. Normal spoilage (defective chairs) averages 1% of good units in the Assembly Department. Ramsha uses process costing (FIFO method) Activity during February in the Assembly Department Stage of completion Material Production activity: Work in process, beginning inventory Started in February Good units transferred out Work in process, ending inventory Conversion 85% 60% 4,500 4,600 300 95% 90% How many units, if any, were rejected? What would be considered normal spoilage (in units)? Cost activity: Materia Conversion $61,80540,275 $ 21,530 Total Costs in beginning WIP February costs 827,220 478,170 What is the equivalent units of production for Materials? What is the equivalent units of production for Conversion? What is the cost per equivalent unit of production for Materials (February production)? What is the cost per equivalent unit of production for Conversion (February production)? What is the total cost of the units transferred out? What is the cost of ending inventory? How much should be charged to Loss from Abnormal Spoilage? What is the unit cost of the goods transferred out in February? Which of the following would be the most likely reason that the unit cost of goods transferred out does not equal the unit cost of units manufactured in February? The cost per unit in January was higher than the cost per unit in February The cost per unit in January was lower than the cost per unit in February Some of the units started and completed in February cost more than other units started and completed in February Some of the units started and completed in February cost less than other units started and completed in February Problem B Ramsha Industries makes rocking chairs. The chairs are assembled in the Assembly Department and stained and sealed in the Finishing Department. Chairs are tested for quality in the Assembly Department before being transferred to Finishing. Normal spoilage (defective chairs) averages 1% of good units in the Assembly Department. Ramsha uses process costing (FIFO method) Activity during February in the Assembly Department Stage of completion Material Production activity: Work in process, beginning inventory Started in February Good units transferred out Work in process, ending inventory Conversion 85% 60% 4,500 4,600 300 95% 90% How many units, if any, were rejected? What would be considered normal spoilage (in units)? Cost activity: Materia Conversion $61,80540,275 $ 21,530 Total Costs in beginning WIP February costs 827,220 478,170 What is the equivalent units of production for Materials? What is the equivalent units of production for Conversion? What is the cost per equivalent unit of production for Materials (February production)? What is the cost per equivalent unit of production for Conversion (February production)? What is the total cost of the units transferred out? What is the cost of ending inventory? How much should be charged to Loss from Abnormal Spoilage? What is the unit cost of the goods transferred out in February? Which of the following would be the most likely reason that the unit cost of goods transferred out does not equal the unit cost of units manufactured in February? The cost per unit in January was higher than the cost per unit in February The cost per unit in January was lower than the cost per unit in February Some of the units started and completed in February cost more than other units started and completed in February Some of the units started and completed in February cost less than other units started and completed in February