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Question - Lexan Textile Company's Job X12 had one of its 20 units spoiled. The cost incurred on the unit was $750. It was specific normal spoilage with an estimated disposal price of $600 for the spoiled unit. Job Y34 had common normal spoilage with the estimated cost of $700 from the general production process failure and abnormal spoilage of $150. The company also incurred scrap due to Job Y34 and sold it for $105. It also sold the scrap common to all jobs for $145 cash in May.
Required -
1. Prepare the necessary journal entries to record normal and abnormal spoilage costs.
2. Prepare the necessary journal entries to record both types of scrap sold.
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