Segado, Inc. mass-produces goods in three processes. In the second process, dire
ID: 2410803 • Letter: S
Question
Segado, Inc. mass-produces goods in three processes. In the second process, direct materials are added at the beginning, conversion costs are incurred evenly throughout the process, and the normal spoilage rate is 5%. This period, the 90,000 units transferred into the second process had costs of $450,000 attached to them from the first process. The 20,000 units in beginning work-in-process inventory (30% complete) were worth $280,000 ($100,000 in transferred-in costs, $120,000 in conversion costs, and $60,000 in direct materials costs). During the period, the second process cost $303,000 for direct materials and $402,720 for conversion. At the end of the period, 85,000 units had been transferred on to the third process, and 22,000 units from process 2 were only 40% complete.
Enter all dollar values without dollar signs
Round your answers to the nearest dollar except costs per equivalent unit.
Physical units: Normal spoilage Abnormal spoilage Equivalent units: For goods completed and transferred out (same for all costs) For goods normally spoiled (same for all costs) For goods abnormally spoiled (same for all costs) For ending work-in-process inventory, transferred-in costs For ending work-in-process inventory, direct materials costs For ending work-in-process inventory, conversion costs Cost per equivalent unit: For transferred-in costs For direct materials For conversion costs The value of: Good units completed and transferred out Abnormal spoilage Ending work-in-process inventoryExplanation / Answer
Pysical units: Normal spoilage 90000*5% 4500 Abnormal spoilage Units transferred to second process 90000 Less: units transferred to third process 85000 Units lost 5000 Less: normal spoilage 4500 500 Equivalent units: Physical Units Direct Materials Conversion For goods completed and transferred out: From beginning work in process: 20000 0 14000 20000*(100%-30%) Statrted and completed 70000 70000 70000 (90000-20000) Normal spoilage 4500 4500 4500 Abnormal spoilage 500 500 500 Ending work in process inventory 22000 22000 8800 (22000*40%) Total equivalent units 97000 97800 Cost per equivalent unit=Total cost to account for/Equivalent units Direct Materials Conversion Beginning work in process 60000 120000 Cost added 303000 402720 Total cost to account for 363000 522720 Total equivalent units 97000 97800 Cost per equivalent units 3.74 5.34 Value of Direct Materials Conversion Total Good units completed and transferred out From beginning work in process: 20000 0 74760 74760 (14000*5.34) Statrted and completed 70000 261800 373800 635600 (70000*3.74) (70000*5.34) 710360 Abnormal spoilage 1870 2670 4540 (500*3.74) (500*5.34) Ending work-in-process inventory 82280 46992 129272 (22000*3.74) (8800*5.34)