Sparkling Ltd is a food processing company manufacturing a soft drink product. Each product will pass...
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Sparkling Ltd is a food processing company manufacturing a soft drink product. Each product will pass through the Carbonating Process. All direct materials are applied at the beginning of the process and conversion costs are added evenly during the process. All spoilage is detected by the final inspection at the end of the process. Normal spoilage is 10% of all good units that pass inspection. Spoilage units are disposed of at zero net disposal value. The company adopts the weighted-average method of process costing. Data for the Carbonating Process in December are as follows: Work in process, beginning, 1 December Started during December Good units completed and transferred out during December Work in process, ending 31 December Total costs added during December Degree of completion of beginning work in process Degree of completion of ending WIP Physical Direct units materials $35,000 17,500 107,500 spoilage); (ii) abnormal spoilage; (iii) units in ending work in process. 97,500 14,000 $465,000 100% 100% Required: (a) For December 2018, show the physical units and compute the equivalent units for each of the cost category. (b) Also for December 2018, summarize total costs to account for and assign these costs to: (i) units completed and transferred out (including normal (c) You are the financial controller of Sparkling Ltd. What issues should you focus on when reviewing the equivalent unit calculation? Conversion costs $79,400 $165,000 60% 80% Sparkling Ltd is a food processing company manufacturing a soft drink product. Each product will pass through the Carbonating Process. All direct materials are applied at the beginning of the process and conversion costs are added evenly during the process. All spoilage is detected by the final inspection at the end of the process. Normal spoilage is 10% of all good units that pass inspection. Spoilage units are disposed of at zero net disposal value. The company adopts the weighted-average method of process costing. Data for the Carbonating Process in December are as follows: Work in process, beginning, 1 December Started during December Good units completed and transferred out during December Work in process, ending 31 December Total costs added during December Degree of completion of beginning work in process Degree of completion of ending WIP Physical Direct units materials $35,000 17,500 107,500 spoilage); (ii) abnormal spoilage; (iii) units in ending work in process. 97,500 14,000 $465,000 100% 100% Required: (a) For December 2018, show the physical units and compute the equivalent units for each of the cost category. (b) Also for December 2018, summarize total costs to account for and assign these costs to: (i) units completed and transferred out (including normal (c) You are the financial controller of Sparkling Ltd. What issues should you focus on when reviewing the equivalent unit calculation? Conversion costs $79,400 $165,000 60% 80%
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ANSWER a For December 2018 the physical units and compute the equivalent units for each of the cost ... View the full answer
Related Book For
Statistics Unlocking the Power of Data
ISBN: 978-1118583104
1st edition
Authors: Robin H. Lock, Patti Frazer Lock, Kari Lock Morgan, Eric F. Lock, Dennis F. Lock
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