ACCTG424 Lecture Notes - Component Object Model, Indian Railways

• School: University of Alberta
• Department: Accounting
• Course: ACCTG424
• Professor: Trish Stringer

Document Summary

In class #18. 1 normal and abnormal spoilage in units. Compute the normal and abnormal spoilage in units. Assume that the equivalent-unit cost of a spoiled unit is . Compute the amount of potential savings if all spoilage were eliminated, assuming that all other costs would be unaffected. Regardless of the targeted normal spoilage, abnormal spoilage is non-recurring and avoidable. The targeted normal spoilage rate is subject to change. Many companies have reduced their spoilage to almost zero, which would realize all potential savings. Of course, zero spoilage usually means higher-quality products, more customer satisfaction, more employee satisfaction, and various beneficial effects on nonmanufacturing (for example, purchasing) costs of direct materials. Show physical units in the first column of your schedule. *normal spoilage is 15% of good units transferred out: 15% (cid:31) 2,100 = 315 units. 3,150 completion of normal spoilage in this department: direct materials, 100%; conversion costs,