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    2 LESSON - Spoiled, Defective, Scrap, Waste

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    Maureen Kaye Palo
    This document discusses accounting for spoiled, defective, scrap, and waste materials from a production job. It provides an example of Job 3044 that produced 4,000 units but had 200 spoiled units and 300 defective units. It examines charging the additional costs from non-conforming materials to either the specific job or distributing across all production. Charging methods are outlined for tracing costs to jobs versus non-traceable allocations to general accounts.

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    2 LESSON - Spoiled, Defective, Scrap, Waste

    Uploaded by

    Maureen Kaye Palo
    12 views3 pages
    This document discusses accounting for spoiled, defective, scrap, and waste materials from a production job. It provides an example of Job 3044 that produced 4,000 units but had 200 spoiled units and 300 defective units. It examines charging the additional costs from non-conforming materials to either the specific job or distributing across all production. Charging methods are outlined for tracing costs to jobs versus non-traceable allocations to general accounts.

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    This document discusses accounting for spoiled, defective, scrap, and waste materials from a production job. It provides an example of Job 3044 that produced 4,000 units but had 200 spoiled units and 300 defective units. It examines charging the additional costs from non-conforming materials to either the specific job or distributing across all production. Charging methods are outlined for tracing costs to jobs versus non-traceable allocations to general accounts.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    12 views3 pages

    2 LESSON - Spoiled, Defective, Scrap, Waste

    Uploaded by

    Maureen Kaye Palo
    This document discusses accounting for spoiled, defective, scrap, and waste materials from a production job. It provides an example of Job 3044 that produced 4,000 units but had 200 spoiled units and 300 defective units. It examines charging the additional costs from non-conforming materials to either the specific job or distributing across all production. Charging methods are outlined for tracing costs to jobs versus non-traceable allocations to general accounts.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 3

    SPOILED UNITS

    DEFECTIVE UNITS

    SCRAP MATERIALS

    WASTE MATERIALS

    ACCOUNTING FOR SPOILED UNITS

    Job 3044

    Units 4,000

    DM 15

    DL 13

    FOH (includes a P1 allowance for spoiled work) 12

    Total 40

    200 rejected units were sold for P18.00 each

    1. Charged to the specific job


    a. Work in process 156,000
    Materials 60,000 4,000 x 15
    Payroll 52,000 4,000 x 13
    FOH applied 44,000 4,000 x 11
    #

    b. Spoiled Goods 3,600


    Work in process 3,600

    c. Finished goods 152,400


    Work in process 152,400

    Finished goods 152,400


    Good units 3,800
    New unit cost 40.11

    2. Charged to all production


    a. Work in process 160,000
    Materials 60,000 4,000 x 15
    Payroll 52,000 4,000 x 13
    FOH applied 48,000 4,000 x 12
    #

    b. Spoiled Goods 3,600


    Factory overhead control 4,400
    Work in process 8,000
    c. Finished goods 152,000
    Work in process 152,000

    Finished goods 152,000


    Good units 3,800
    Same unit cost 40.00

    ACCOUNTING FOR DEFECTIVE UNITS


    Job 3044
    Units 4,000

    DM 15
    DL 13
    FOH (includes a P1 allowance for defective units) 12
    Total 40

    Defective units 300


    Additional costs:
    Materials 2,000
    Labor 4,000
    OH 2,000

    1. Charged to the specific job


    a. Work in process 156,000
    Materials 60,000 4,000 x 15
    Payroll 52,000 4,000 x 13
    FOH applied 44,000 4,000 x 11

    b. Work in process 8,000


    Materials 2,000
    Payroll 4,000
    FOH applied 2,000

    c. Finished goods 164,000


    Work in process 164,000

    Finished goods 164,000


    Units produced 4,000
    New unit cost 41.00

    2. Charged to all production


    a. Work in process 160,000
    Materials 60,000 4,000 x 15
    Payroll 52,000 4,000 x 13
    FOH applied 48,000 4,000 x 12

    b. Factory overhead control 8,000


    Materials 2,000
    Payroll 4,000
    FOH applied 2,000

    c. Finished goods 160,000


    Work in process 160,000
    Finished goods 160,000
    Units produced 4,000
    Same unit cost 40.00

    SCRAP MATERIALS
    1. If it can be traced to the specific job
    Scrap Materials xx
    Work in process xx

    2. If not traceable to a specific job


    Scrap Materials xx
    Miscellaneous income xx

    3. Scrap are from the factory supplies


    Scrap Materials xx
    Factory overhead control xx

    WASTE MATERIALS
    1. Charged to all jobs
    Factory overhead control xx
    Accounts payable xx

    2. Charged to specific job


    Work in process (Job number) xx
    Accounts payable xx

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