The Memphis Division of Southeastern Paint produces environmental paints in processes in which spolage takes place on a continual basis Custom Essay

(EUP computations; normal and abnormal loss) The Memphis Division of Southeastern Paint produces environmental paints in processes in which spolage takes place on a continual basis. Management considers normal spoilage to be 0.4 percent or less of gallons of material placed into production. The following operating statistics are available for June 2003 for the paint BMZ: Beginning inventory(20% complete as to material; 30% complete as to conversion) 8,000 gallons Started in June 180,000 gallons Ending Inventory (70% complete as to material; 80% complete as to conversion) 4,000 gallons Spoiled 1,400 gallons a.How many gallons were transferred on? b.How much normal spoilage occured? c. How much abnormal spoilage occured? d.What are the FIFO equivalent uit of production for materials? For conversion costs? e. How are costs associated with the normal spolage handled? f. How are costs associated with the abnormal spoilage handled?


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