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Question - Kilroy manufactures pottery products. All direct materials are included at the inception of the production process. For April, there was no beginning inventory in the processing plant. Direct materials totaled $155,000 for the month. Work-in-process records revealed that 2,500 tons were started in April and that 1,500 tons were finished; 500 tons 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. Following information has been added for your convenince:
Recognized
Ignored
Cost to account for
$155,000
Equivalent units
2,500
Required -
1. Calculate cost per equivalent unit when spoilage units are recognized and when they are not recognized.
2. Calculate the costs assigned to units completed and transferred out when spoilage units are recognized and when they are not recognized.
3. Calculate costs assigned to normal spoilage when spoilage units are recognized and when they are not recognized.
4. Calculate the costs assigned to ending work-in- process when spoilage units are recognized and when they are not recognized.
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