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SPOILAGE, REWORKED UNITS, AND SCRAP questions

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Question;THE FOLLOWING INFORMATION APPLIES TO;QUESTIONS 37 THROUGH 41.;Astoria Computer Systems, Inc.;manufactures printers. All direct materials are added at the inception of the;production process. During January, the accounting department noted that there;was no beginning inventory. Direct materials purchases totaled $100,000 during;the month. Work-in-process records revealed that 4,000 cards were started in;January, 2,000 cards were complete, and 1,500 units were spoiled as expected.;Ending work-in-process units are complete in respect to direct materials costs.;Spoilage is not detected until the process is complete.;37. What;are the respective direct material costs per equivalent unit, assuming spoiled;units are recognized or ignored?;a. $20.00, $35.00;b. $25.00, $40.00;c. $30.00, $45.00;d. $35.00, $50.00;38. What;is the direct material cost assigned to good units completed when spoilage;units are recognized?;a. $50,000;b. $100,000;c. $80,000;d. $87,500;39. What;is the cost transferred out assuming spoilage units are ignored?;a. $87,500;b. $80,000;c. $50,000;d. $77,500;40. What;are the amounts allocated to the work-in-process ending inventory assuming;spoilage units are recognized and ignored, respectively?;a. $20,000, $24,500;b. $30,000, $34,250;c. $12,500, $20,000;d. $37,500, $40,000;41. Spoilage;costs allocated to ending work in process are larger by which method and by how;much?;a. When spoiled units are recognized by;$2,500;b. When spoiled units are recognized by;$4,250;c. When spoiled units are ignored by $7,500;d. When spoiled units are recognized by;$7,500;THE FOLLOWING INFORMATION APPLIES TO;QUESTIONS 42 THROUGH 47.;Craft Concept manufactures small tables;in its Processing Department. Direct materials are added at the initiation of;the production cycle and must be bundled in single kits for each unit.;Conversion costs are incurred evenly throughout the production cycle. Before;inspection, some units are spoiled due to nondetectible materials defects.;Inspection occurs when units are 50% converted. Spoiled units generally;constitute 5% of the good units. Data for December 20x3 are as follows;WIP;beginning inventory 12/1/20x3 10,000;units;Direct;materials (100% complete);Conversion;costs (75% complete);Started;during December 40,000;units;Completed;and transferred out 12/31/20x3 38,400;units;WIP;ending inventory 12/31/20x3 8,000;units;Direct;materials (100% complete);Conversion;costs (65% complete);Costs;for December;WIP;beginning Inventory;Direct;materials $;50,000;Conversion;costs 30,000;Direct;materials added 100,000;Conversion;costs added 140,000;42. What;is the number of total spoiled units?;a. 1,600 units;b. 2,000 units;c. 2,700 units;d. 3,600 units;43. Normal;spoilage totals;a. 1,600 units.;b. 2,000 units.;c. 1,920 units.;d. 2,700 units;44. Abnormal;spoilage totals;a. 1,600 units.;b. 2,000 units.;c. 1,680 units.;d. 1,920 units.;45. What;is the total cost per equivalent unit using the weighted-average method of;process costing?;a. $3.00;b. $3.60;c. $6.60;d. $4.60;46. What;cost is allocated to abnormal spoilage using the weighted-average;process-costing method?;a. $ 0;b. $ 7,360;c. $11,088;d. $16,400;47. What;are the amounts of direct materials and conversion costs assigned to ending;work in process using the weighted-average process-costing method?;a. $18,720, $24,000;b. $22,900, $19,820;c. $24,000, $18,720;d. $28,560, $14,160;48. The;cost per good unit in the weighted-average method is equal to;a. the total cost of direct materials and;conversion costs per equivalent unit, plus a share of normal spoilage.;b. the sum of the costs per equivalent unit;of direct materials, and conversion costs.;c. the total costs divided by total;equivalent units.;d. none of the above.;49. Under;the FIFO method, all spoilage costs are assumed to be;a. related to the units in beginning;inventory, plus the units completed during the period.;b. related to the units completed during the;period.;c. related to the units in ending inventory.;d. related to the units in both beginning and;ending inventory plus the units completed during the period.

 

Paper#53547 | Written in 18-Jul-2015

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