Whitefish Machine Shop is a manufacturer of motorized carts for vacation resorts. Patrick Cullin, the plant manager of Whitefish, obtains the following information for Job #10 in August 2017. A total of 30 units were started, and 6 spoiled units were detected and rejected at final inspection, yielding 24 good units. The spoiled units were considered to be normal spoilage. Costs assigned prior to the inspection point are $1,050 per unit. The current disposal price of the spoiled units is $225 per unit. When the spoilage is detected, the spoiled goods are inventoried at $225 per unit.
Read the requirements.
Requirement 1. What is the normal spoilage rate?
Select the formula, then calculate the normal spoilage rate. (Round the percentage to the nearest tenth percent, X.X%.)
Normal spoilage rate
%
Requirements
1. What is the normal spoilage rate?
2. Prepare the journal entries to record the normal spoilage, assuming the following:
a. The spoilage is related to a specific job.
b. The spoilage is common to all jobs.
c. The spoilage is considered to be abnormal spoilage.
Print
Done
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