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 undetectable defects.Inspection occurs when units are 40% converted.Spoiled fillets generally constitute 6% of the good fillets.Data for April 2017 are as follows:

Costs for April:

What cost is allocated to abnormal spoilage using the weighted-average process-costing method? (Round any cost per unit calculations to the nearest cent. )

Question

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 undetectable defects.Inspection occurs when units are 40% converted.Spoiled fillets generally constitute 6% of the good fillets.Data for April 2017 are as follows:

Costs for April:

What cost is allocated to abnormal spoilage using the weighted-average process-costing method? (Round any cost per unit calculations to the nearest cent. )

Costs for April:

What cost is allocated to abnormal spoilage using the weighted-average process-costing method? (Round any cost per unit calculations to the nearest cent. )

Quizplus · Accepted Answer

Spoiled units = 85,000 + 134,000 - 183,000 - 24,000 = 12,000 units
Normal spoilage = 6% × 183,000 units = 10,980 spoiled units
Abnormal spoilage = 12,000 units - 10,980 units = 1020 units
 11ea8a5a_a067_5e80_a19c_6b29a059fbd3_TB5540_00_TB5540_00_TB5540_00 * Equivalent unit calculations:
Direct Materials: 85,000 + 134,000 = 219,000 units
Conversion Costs: 183,000 + 12,000 + (24,000 x 25%)= 201,000 units
Total cost per equivalent unit = $2.05 + $2.47 = $4.52
1020 units × $4.52 = $4610

Fish Fillet Incorporated Obtains Fish and Then Processes Them into Frozen