18-27 Spoilage, journal entries. Plastique produces parts for use in various industries. Plastique uses a job-costing system. The nature of its process is such that management expects normal spoilage at a rate of 2% of good parts. Data for last month is as follows: Production (units) 10,000 Good parts produced 9,750 Direct material cost/unit $ 5.00 The spoiled parts were identified after 100% of the direct material cost was incurred. The disposal value is $2/part. Q. Record the journal entries if the spoilage was (a) job specific or (b) common to all jobs.

18-27 Spoilage, journal entries. Plastique produces parts for use in various industries. Plastique uses a job-costing system. The nature of its process is such that management expects normal spoilage at a rate of 2% of good parts. Data for last month is as follows: Production (units) 10,000 Good parts produced 9,750 Direct material cost/unit $ 5.00 The spoiled parts were identified after 100% of the direct material cost was incurred. The disposal value is $2/part. Q. Record the journal entries if the spoilage was (a) job specific or (b) common to all jobs.

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Description: 18-27 Spoilage, journal entries. Plastique produces parts for use in various industries. Plastique uses a job-costing system. The nature of its process is such that management expects normal spoilage at a rate of 2% of good parts. Data for last month

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter2: Accounting For Materials

Section: Chapter Questions

Problem 20E: Spoiled work Roger Company manufactures tennis clothing. During the month, the company cut and...

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Spoiled work Roger Company manufactures tennis clothing. During the month, the company cut and assembled 8,000 skirts. One hundred of the skirts did not meet specifications and were considered seconds. Seconds are sold for 9.95 per skirt, whereas first-quality skirts sell for 39.95. During the month, Work in Process was charged 108,000: 36,000 for materials, 48,000 for labor, and 24,000 for factory overhead. Record the entries to first charge production costs for the period and to then record the loss due to spoiled work, under each of the following conditions: a. The loss due to spoiled work is spread over all jobs in the department. b. The loss due to spoiled work is charged to the specific job because it is a special order.
AAA Appliances Inc. has two production departments. The nature of the process is such that no units remain in process in Finishing at the end of the period. At the beginning of the period, 10,000 units with a cost of 30,000 were transferred from Assembly to Finishing. Finishing incurred costs of 8,800 for materials, 7,200 for labor, and 8,800 for factory overhead, and finished 10,000 units during the month. a. Determine the unit cost for the month in Finishing. b. Determine the unit cost of the products transferred to finished goods.
AAA Appliances Inc. has two production departments. The nature of the process is such that no units remain in process in Finishing at the end of the period. At the beginning of the period, 10,000 units with a cost of 30,000 were transferred from Assembly to Finishing. Finishing incurred costs of 8,800 for materials, 7,200 for labor, and 8,800 for factory overhead, and finished 10,000 units during the month. Using the data in E5-9, prepare a statement of cost of goods manufactured for the month ended January 31, 2016, assuming that no further work was done in Assembly during January.
Argo Manufacturing Co. had 500 units, three-fifths completed, in process at the beginning of the month. During the month, 2,000 units were started in process and finished. There was no work in process at the end of the month. Unit cost of production for the month was 1.20. Costs for materials, labor, and factory overhead incurred in the current month totaled 2,655. Calculate the unit cost for the prior month. (Hint: You must first determine what the dollar balance in work in process must have been at the beginning of the month, as well as the equivalent production of the units in beginning inventory.)
Jenny Company's Job No. 520 for the manufacture of 6,600 coats was completed December at the following unit costs: Direct materials - 1,500, Direct labor - 1,000, Factory overhead (including allowance of P50 for spoiled work) - 500. Total = 3,000. Final inspection of Job No. 520 disclosed 600 spoiled costs. These were subsequently sold to a jobber for 600,000. Assuming that spoilage loss is charged to all production, what would be the unit cost of the good coats produced per Job No. 520?
Guess Apparel completed 3,600 expensive bags during the 1st quarter of the current year. The following costs per unit are presented below:Direct materials P200Direct labor 180Factory overhead, including P10 allowance for spoilage180 Final inspection revealed that 600 bags were spoiled which were sold as export overrun at an amount equal to 40% of production costs. The good units were delivered and billed thecustomer at 20% gross profit.1. If the spoilage is common to all jobs, the amount billed to the customer is_____________2. If spoilage is due to customer’s intervention, how much is the gross profit on theorder? _______________
Guess Apparel completed 3, 600 expensive bags during the 1st quarter of the current year. The following costs per unit are presented below: Direct materials  P200Direct Labor 180Factory overhead, included P10 allowance for spoilage 180Final inspection revealed that 600 bags were spoiled which were sold as export overrun at 40% of production costs. The good units were delivered and billed the customer at 120% above cost.If the spoilage is common to all jobs, the amount billed to the customer is:
Job 456 manufactured 12,000 units that were completed in February at unit costs presented as follows:            Direct materials   P35            Direct labor                                                                  28            Factory overhead (includes an allowance of P15                        Spoiled work)                                                    29Final inspection of Job 456 disclosed 125 spoiled units, which were sold for P22,500.What would be the unit cost of good units if the spoilage loss is attributable to exacting specifications of Job 001?
12. Accounting Apparel completed 3,600 expensive bags during the 1st quarter of the current year.  The following costs per unit are presented below:Direct materials P200Direct labor P180Factory overhead, including P10 allowance for spoilage P180Final inspection revealed that 600 bags were spoiled which were sold as export overrun at an amount equal to 40% of production costs. The good units were delivered and billed to the customer at 20% gross profit.If the spoilage is common to all jobs, the amount billed to the customer is:
SHINING Apparel completed 3, 600 expensive bags during the 1st quarter of the current year. The following costs per unit are presented below: Direct materials  P200Direct Labor 180Factory overhead, included P10 allowance for spoilage 180Final inspection revealed that 600 bags were spoiled which were sold as export overrun at 40% of production costs. The good units were delivered and billed the customer at 120% above cost.If the spoilage is common to all jobs, the amount billed to the customer is: A. 1,680,000 B. 2,100,000 C. 2,016,000 D. 3,696,000
Simar Company’s Job 888 manufactured 13,750 units that were completed in February at unit costs presented as follows:            Direct materials   P300            Direct labor                                                                  270            Factory overhead (includes an allowance of P15                        Spoiled work)                                                    270Final inspection of Job 888 disclosed 1,250 spoiled units, which were sold for P225,000.What would be the unit cost of good units if the spoilage loss is attributable to exacting specifications of Job 004?
Zea Company’s Job 888 manufactured 13,750 units that were completed in February at unit costs presented as follows:            Direct materials $300            Direct labor                                                                  270            Factory overhead (includes an allowance of P15                        Spoiled work)                                                    270Final inspection of Job 888 disclosed 1,250 spoiled units, which were sold for $225,000.What would be the unit cost of good units if the spoilage loss is attributable to exacting specifications of Job 004?