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Endicott Shoes Manufactures Shoes

Question 36

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Endicott Shoes manufactures shoes.All direct materials are included at the inception of the production process.For March, there were 1,400 units in beginning inventory with a direct material cost of $700.Direct materials totaled $15,000 for the month.Work-in-process records revealed that 35,000 units were started in March and that 30,000 were finished.Normal spoilage of 2% of units finished was incurred.Ending work-in-process units are complete in respect to direct materials costs.Spoilage is not detected until the process is complete.Endicott uses the weighted-average method.Required:
a.What are the costs assigned to completed units when spoilage units are recognized and when they are not recognized in the cost per equivalent unit?
b.What are the costs transferred out if spoilage units are recognized and if they are ignored?
c.What are the amounts allocated to the work-in-process ending inventory when spoilage units are recognized and when spoilage units are ignored?

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a.Equivalent units (...

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