Answer the following questions using the information below:
Fish Fillet Incorporated obtains fish and then processes them into frozen fillets and then prepares the frozen fish fillets for distribution to its retail sales department. Direct materials are added at the initiation of the cycle. Conversion costs are incurred evenly throughout the production cycle. Before inspection, some fillets are spoiled due to nondetectible defects. Inspection occurs when units are 50% converted. Spoiled fillets generally constitute 4% of the good fillets. Data for April 2015 are as follows:
$\begin{array} { l }
\text {WIP, beginuing inventory 4/1/2015 }& \text { 85,000 fillets} \ \text {Direct materials (100\% complete) }\ \text {Conversion costs ( $ 50 \% $ complete) }\
\text { Started during April } & 130,000 \text { fillets } \
\text { Completed and transferred out } 4 / 31 / 2015 & 180,000 \text { fillets } \
\text { WIP, ending inventory } 4 / 31 / 2015 & 22,000 \text { fillets }\
\text {Direct materials ( $ 100 \% $ complete) }&\ \text { Conversion costs ( $ 20 \% $ complete) }\
\\text { Costs for April: }\
\text { WIP, beginuning Inventory: }\
\text { Direct materials } & \$ 130,000 \
\text { Conversion costs } & 95,910 \
\text { Direct materials added } & 300,000 \
\text { Conversion costs added } & 383,130
\end{array}$

-What cost is allocated to abnormal spoilage using the weighted-average process-costing method?

Question

Answer the following questions using the information below:
Fish Fillet Incorporated obtains fish and then processes them into frozen fillets and then prepares the frozen fish fillets for distribution to its retail sales department. Direct materials are added at the initiation of the cycle. Conversion costs are incurred evenly throughout the production cycle. Before inspection, some fillets are spoiled due to nondetectible defects. Inspection occurs when units are 50% converted. Spoiled fillets generally constitute 4% of the good fillets. Data for April 2015 are as follows:
 $\begin{array} { l  }
 \text {WIP, beginuing inventory 4/1/2015 }& \text { 85,000 fillets} \ \text {Direct materials (100\% complete) }\ \text {Conversion costs ( $ 50 \% $ complete) }\
\text { Started during April } & 130,000 \text { fillets } \
\text { Completed and transferred out } 4 / 31 / 2015 & 180,000 \text { fillets } \
\text { WIP, ending inventory } 4 / 31 / 2015 & 22,000 \text { fillets }\
 \text {Direct materials ( $ 100 \% $ complete) }&\ \text { Conversion costs ( $ 20 \% $ complete) }\
\\text { Costs for April: }\
\text { WIP, beginuning Inventory: }\
 \text { Direct materials } & \$ 130,000 \
\text { Conversion costs } & 95,910 \
\text { Direct materials added } & 300,000 \
\text { Conversion costs added } & 383,130
\end{array}$

-What cost is allocated to abnormal spoilage using the weighted-average process-costing method?

Quizplus · Accepted Answer

The weighted-average process-costing method allocates costs to units based on the average cost per unit. In this case, the average cost per unit is calculated by dividing the total costs incurred during the period by the total number of units produced during the period. The total costs incurred during the period are $300,000 (direct materials) + $383,130 (conversion costs) = $683,130. The total number of units produced during the period is 180,000 fillets. Therefore, the average cost per unit is $683,130 / 180,000 = $3.80.The abnormal spoilage cost is the cost of the units that were spoiled due to nondetectible defects. In this case, 4% of the good fillets were spoiled, which means that 4% of the 180,000 good fillets were spoiled. Therefore, the number of units that were spoiled is 180,000 * 0.04 = 7,200 units. The cost of the spoiled units is $3.80 per unit, so the total cost of the abnormal spoilage is 7,200 units * $3.80 per unit = $25,520.

Answer the Following Questions Using the Information Below: Fish Fillet

Answer the Following Questions Using the Information Below:
Fish Fillet