Springfield Sign Shop manufactures only specific orders. It uses a standard cost system. During one large order for the transit authority, an unusual number of signs were spoiled. The normal spoilage rate is 10% of units started. The point of first inspection is half way through the process, the second is three-fourths through the process, and the final inspection is at the end of the process. Other information about the job is as follows:
Average point of spoilage is the 3/4 completion point
Required:
Make necessary journal entries to record all spoilage.

Question

Springfield Sign Shop manufactures only specific orders. It uses a standard cost system. During one large order for the transit authority, an unusual number of signs were spoiled. The normal spoilage rate is 10% of units started. The point of first inspection is half way through the process, the second is three-fourths through the process, and the final inspection is at the end of the process. Other information about the job is as follows:
   Average point of spoilage is the 3/4 completion point
  Required:
Make necessary journal entries to record all spoilage.

Quizplus · Accepted Answer

The Answer of Springfield Sign Shop manufactures only specific orders. It uses a standard cost system. During one large order for the transit authority, an unusual number of signs were spoiled. The normal spoilage rate is 10% of units started. The point of first inspection is half way through the process, the second is three-fourths through the process, and the final inspection is at the end of the process. Other information about the job is as follows:
   Average point of spoilage is the 3/4 completion point
  Required:
Make necessary journal entries to record all spoilage.

Springfield Sign Shop Manufactures Only Specific Orders