Andersen Corporation Andersen Corporation has the following information for the current month:

Units started 95,000 units

Beginning Work in Process: (30% complete) 15,000 units

Normal spoilage (discrete) 3,000 units

Abnormal spoilage 4,000 units

Ending Work in Process: (75% complete) 15,000 units

Transferred out 88,000 units

Beginning Work in Process Costs:

Material $18,000

Conversion 14,000

All materials are added at the start of the production process.Andersen Corporation inspects goods at 75 percent completion as to conversion. Refer to Andersen Corporation.Assume that the costs per EUP for material and conversion are $2.00 and $2.25,respectively.What is the cost assigned to normal spoilage,using weighted average,and where is it assigned? $\text {\underline{ Value} }$ $\text {\underline{ Assigned To} }$

Question

Andersen Corporation Andersen Corporation has the following information for the current month:

Units started	95,000 units
Beginning Work in Process: (30% complete)	15,000 units
Normal spoilage (discrete)	3,000 units
Abnormal spoilage	4,000 units
Ending Work in Process: (75% complete)	15,000 units
Transferred out	88,000 units
Beginning Work in Process Costs:
	Material $18,000
	Conversion 14,000

All materials are added at the start of the production process.Andersen Corporation inspects goods at 75 percent completion as to conversion. Refer to Andersen Corporation.Assume that the costs per EUP for material and conversion are $2.00 and $2.25,respectively.What is the cost assigned to normal spoilage,using weighted average,and where is it assigned? $\text {\underline{ Value} }$ $\text {\underline{ Assigned To} }$

Quizplus · Accepted Answer

$11,063 Units transferred outNormal spoilage is considered part of the cost of production and is included in the cost of units transferred out. The cost assigned to normal spoilage is calculated based on the equivalent units of production (EUP) for materials and conversion costs up to the point of inspection, which is at 75% completion. Since all materials are added at the start, the material cost for spoiled units is fully accounted for, but only a portion of the conversion cost is included up to the point of inspection. Given the costs per EUP for material ($2.00) and conversion ($2.25), and considering that normal spoilage is 3,000 units, the calculation for the cost assigned to normal spoilage would focus on the costs incurred up to the point of spoilage detection. However, the specific calculation details leading to the $11,063 figure are not provided in the question, but the correct approach involves allocating the spoilage cost to the units transferred out, reflecting the costs incurred before the spoilage was identified.

Andersen Corporation Andersen Corporation Has the Following Information for the Current

Andersen Corporation
Andersen Corporation Has the Following Information for the Current