Cost Accounting notes
Normal spoilage = % of good units completed. Abnormal spoilage = total spoilage - normal spoilage.
2. Compute output in terms of equivalent units. Example page 644.
Step 1 Step 2 Equivalent units
(physical units) Direct materials Conversion Costs
Work in process ending 2000
(2000x100%; 2000x50%) 2000 1000
3. Summarize total costs to account for - all costs debited to work in process.
4. Compute cost per equivalent unit.
5. Assign total costs to units completed, to spoiled units, and to units in ending WIP.
Weighted average method of process costing with spoilage
Total production Direct Conversion
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