Solution-What are the total conversion costs of abnormal

What are the total conversion costs of abnormal spoilage

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Reference no: EM132655665

Giddings Pharmaceutical Company is a maker of drugs for high blood pressure and uses a process costing system. The following information pertains to the final department of Giddings's blockbuster drug called Solcax.

Beginning work-in-process (40% completed) 800units

Transferred-in 4,000units

Normal spoilage 400units

Abnormal spoilage 200units

Good units transferred out 3,600units

Ending work-in-process (1/3 completed) 600units

Conversion costs in beginning inventory$2,560

Current conversion costs$6,900

Giddings calculates separate costs of spoilage by computing both normal and abnormal spoiled units. Normal spoilage costs are reallocated to good units and abnormal spoilage costs are charged as a loss. The units of Solcax that are spoiled are the result of defects not discovered before inspection of finished units. Materials are added at the beginning of the process. Using the weighted-average method, answer the following question:

Problem 1: What are the total conversion costs of abnormal spoilage?

Reference no: EM132655665

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What are the total conversion costs of abnormal spoilage

Reference no: EM132655665

Reference no: EM132655665

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