Question 7 ( 8 points) At Atlanta Company, direct materials are added at the start of the process and conversion costs are added evenly during the process. Company is using FIFO method for its process costing. The following is given for a cooking department for month of May: Inspection occurs when production is 100 percent completed. Normal spoilage is 4 percent of units that successfully pass the inspection point in current month. The following cost data are available: Beginning Work in Process Costs: DM \$216,000; CC $27,000 Costs added during current period: DM $1,349,400;CC$235,600 Additional costs of $30,000 incurred because some units required rework upon inspection. Total rework cost was $30,000$20,000 was considered normal rework. Compute normal spoilage units. Example of Answer: 4000 (No comma, space, decimal point, or $ sign) A Which of the following statements is true of conversion costs? a) In process costing, they include all the factors of production. b) They include all manufacturing costs including direct materials, direct labor, and other direct and indirect manufacturing costs. c) In process costing, they are usually considered to be added evenly throughout the production process. d) They include only direct materials and excludes all other manufacturing and non-manufacturing costs