What is the effect of the sale of scrap on revenue?
Revenue received from the sale of scrap on a job lowers the total costs for that job. B. Scrap is always allocated to a specific job. C. Scrap is separated between normal and abnormal scrap. D. There are costs assigned to scrap.
What does the scrap from job 372 consist of?
The scrap from Job 372 consists of a metal used by many other jobs. No record is maintained of the scrap generated by individual jobs. Assume that scrap is accounted for at the time of its sale. Scrap totaling 4,500 dollars is sold.
What are the journal entries for scrap generated in requirement 2?
Suppose the scrap generated in requirement 2 is returned to the storeroom for future use, and a journal entry is made to record the scrap. A month later, the scrap is reused as direct material on a subsequent job. Prepare the journal entries to record these transactions. Check back soon! World Class Steaks is a meat-processing firm based in Texas.
How to account for scrap generated by individual jobs?
No record is maintained of the scrap generated by individual jobs. Assume that scrap is accounted for at the time of its sale. Scrap totaling 4,500 dollars is sold. Prepare two alternative journal entries that could be used to account for the sale of scrap. 3.
Problem 1
Why is there an unmistakable trend in manufacturing to improve quality?
Problem 5
"What has been regarded as normal spoilage in the past is not necessarily acceptable as normal spoilage in the present or future." Explain.
Problem 6
"Units of abnormal spoilage are inferred rather than identified." Explain.
Problem 7
"In accounting for spoiled units, we are dealing with cost assignment rather than cost incurrence." Explain.
Problem 8
"Total input includes abnormal as well as normal spoilage and is, therefore, inappropriate as a basis for computing normal spoilage." Do you agree? Explain.
Problem 9
"The inspection point is the key to the allocation of spoilage costs." Do you agree? Explain.
Problem 10
"The unit cost of normal spoilage is the same as the unit cost of abnormal spoilage." Do you agree? Explain.