Question

Safeclear, Inc., is the leading manufacturer of automotive glass components such as windshields. The company uses a process-costing system to account for its work-in-process inventories. When Job 26, an order for windshields for the Chevy Malibu, was being processed, a piece of laminated sheet glass was off-center in the cutting machine and two windshields were spoiled. Because this problem occurs periodically, it is considered normal spoilage and is consequently recorded as an overhead cost. Because this step comes first in the process of making the windshields, the only costs incurred were $ 325 for direct materials. Assume the laminated glass cannot be sold, and its cost has been recorded in work-in-process inventory.

Required
Prepare the journal entries to record the spoilage incurred.



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  • CreatedMay 14, 2014
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