1.Bottling Department (FIFO)17. Cost of Abnormal Spoilage: ________________________18. Cost of Ending Work in Process: ________________________ SpotQut Company manufactures an industrial strength pet stain removal solution in twodepartments; mixing and bottling. Note: The Company sells its product in 8 oz. spray bottles."Ingredients are added throughout the Mixing Department process. However, all bottling materialsare in place at the beginning of the Bottling Department process. The company inspects theproduct for faulty spray bottles and ineffertive solution at the end of the bottling process. Thenomal spoilage rate is I percent of good units transferred out to Finished Goods Inventory.The following information for the two departments for the month of January is as follows:Materials ConversionРегcentPercentMaterials CouversionMixing DepartmentWork in process, January ITransferred to BottlingOunces CompleteComplete30%CostsCosts36,00040%$2,100$3,100288,000Work in process, January 3133,60090%40%Materials ConversionPriorPercentPercentMaterials ConversionDeptBottling DepartmentWork in process, January ITransferred to Finished GoodsSpoiledWork in process. January 31Complete100%BottlesCompleteCostsCostsCosts5,50060%$6,200$2,300S18,00034,5009006,100100%30%Costs incurred in January:Mixing DepartmentBottling DepartmentDirect MaterialsConversion$81,80027,900$30,80043.000Required:Complete the following information for the month of January for the Mixing and BottlingDepartments. Both departments use the FIFO method of process costing.

Process costing is the method of ascertaining costs for goods that a processed in similar manner…

Business

Accounting

17. Cost of Abnormal Spoilage: ________________________ 18. Cost of Ending Work in Process: ________________________

17. Cost of Abnormal Spoilage: 18. Cost of Ending Work in Process:

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter1: Introduction To Cost Management

Section: Chapter Questions

Problem 2E: Hepworth Communications produces cell phones. One of the four major electronic components is...

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Chemet manufactures chemicals in a continuous process. The company combines various materials in a specially configured machine at the beginning of the process, and conversion is considered uniform through the period. Occasionally, the chemical reactions among the materials do not work as expected and the output is then considered spoiled. Normal spoilage is 4% of the good units that pass inspection. The following information pertains to March 2017: Beginning inventory = 2,500 units (100% complete for materials; 25% complete for conversion costs) Units started = 30,000 Units in ending work in process = 2,100 (100% complete for materials; 70% complete for conversion costs) Chemet had 1,900 spoiled units in March 2017. compute the normal and abnormal spoilage in units, assuming the inspection point is at (a) the 20% stage of completion, (b) the 45% stage of completion, and (c) the 100% stage of completion.
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Michael’s Pottery makes decorative garden pieces using three consecutive processes: Moulding, Baking & Spraying. Quality control check takes place during the process, at which point, rejected units are separated fromgood units. The following details relate to production for the month of October 2020, for the Baking Department. i) Work-in-process, October 1: -0- ii) Transfer from Moulding: 2,000 units valued at $336.40 each iii) Other manufacturing costs incurred during October:Direct material added $202,120Direct Manufacturing Wages $212,840Manufacturing Overhead Applied $306,160 iv) Normal losses are estimated to be 5% of the units transferred in during the period. Losses from the Baking Department are deemed to be scrap and sold at $382 each. v) At inspection 300 decorative pieces were rejected as scrap. These units had reached the following degree of completion:From Moulding 100%Direct material added 40%Conversion costs 12½% vi) 1,200 pieces were completed and…
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Hepworth Communications produces cell phones. One of the four major electronic components is produced internally. The other three components are purchased from external suppliers. The electronic components and other parts are assembled (by the Assembly Department) and then tested (by the Testing Department). Any units that fail the test are sent to the Rework Department where the unit is taken apart and the failed component is replaced. Data from the Testing Department reveal that the internally produced component (made by the Component Department) is the most frequent cause of product failure. One out of every 50 phones fails because of a faulty internally produced component. Barry Norton is the manager of the Component Department. In a recent performance evaluation, the plant manager told Barry that he needed to be more sensitive to the needs of the departments customers. This charge puzzled Barry somewhatafter all, the component is not sold to anyone but is used in producing the plants cell phones. Required: 1. Who are Barrys customers? 2. Explain the plant managers charge to Barry to be more sensitive to his customers. Explain also how this increased sensitivity could improve the companys time-based competitive ability. 3. What role would cost management play in helping Barry be more sensitive to his customers?
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