Mike's Bikes makes gears for mountain bikes. It is considered normal for 3% of the good gears in a batch to be defective. The spoilage costs of a defective gear are $20, but a defective gear can be sold for $5 as scrap. Batch #248 contains 103 gears, and 3 are defective. Which of the following is the correct entry to record the costs of spoilage and the sale of the scrap?

Question

Quizplus · Accepted Answer

The Answer of Mike's Bikes makes gears for mountain bikes. It is considered normal for 3% of the good gears in a batch to be defective. The spoilage costs of a defective gear are $20, but a defective gear can be sold for $5 as scrap. Batch #248 contains 103 gears, and 3 are defective. Which of the following is the correct entry to record the costs of spoilage and the sale of the scrap?

Mike's Bikes Makes Gears for Mountain Bikes