Question
Sunny Day Machine Shop is a manufacturer of motorized carts for vacation resorts. Patrick? Cullin, the plant manager of Sunny Day?, obtains the following information
Sunny Day Machine Shop is a manufacturer of motorized carts for vacation resorts. Patrick? Cullin, the plant manager of Sunny Day?, obtains the following information for Job? #10 in August 2014. A total of 60 units were? started, and 10 spoiled units were detected and rejected at final? inspection, yielding 50 good units. The spoiled units were considered to be normal spoilage. Costs assigned prior to the inspection point are $1,400 per unit. Assume that the 10 spoiled units of Sunny Day Machine ?Shop's Job? #10 can be reworked for a total cost $2,400. A total cost of $14,000 associated with these units has already been assigned to Job? #10 before the rework.
Prepare the journal entries for the rework, assuming the following:
a. The rework is related to a specific job.
b. The rework is common to all jobs.
c. The rework is considered to be abnormal.
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